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5  ,000  YEARS 







5,000  YEARS 




©  2011  David  Graeber 

First  Melville  House  Printing:  May  2011 

Melville  House  Publishing 
145  Plymouth  Street 
Brooklyn,  New  York  11201 

ISBN:  978-1-933633-86-2 

Printed  in  the  United  States  of  America 

123456789  10 

Library  of  Congress  Cataloging-in-Publication  Data 
Graeber,  David. 

Debt  :  the  first  5,000  years  /  David  Graeber. 
p.  cm. 

Includes  bibliographical  references  and  index. 
ISBN  978-1-933633-86-2  (alk.  paper) 

1.  Debt-History.  2.  Money-History.  3.  Financial  crises-History. 
I.  Title. 

HG3701.G73  2010 
332— dc22 



1  On  The  Experience  of 

Moral  Confusion  1 

2  The  Myth  of  Barter  21 

3  Primordial  Debts  43 

4  Cruelty  and  Redemption  73 

5  A  Brief  Treatise  on  the  Moral 

Grounds  of  Economic  Relations  89 

6  Games  with  Sex  and  Death  127 

7  Honor  and  Degradation,  or, 
On  the  Foundations  of 

Contemporary  Civilization  165 

8  Credit  Versus  Bullion, 

And  the  Cycles  of  History  211 

9  The  Axial  Age  (800  BC-600  AD)  223 

10  The  Middle  Ages  (600  AD-1450  AD)  251 

n  Age  of  the  Great  Capitalist 

Empires  (1450-1971)  307 

12  (1971-The  Beginning  of  Something 

Yet  to  Be  Determined)  361 

Notes  393 

Bibliography  455 

Index  493 

Chapter  One 


•  noun  i  a  sum  of  money  owed.  2  the 
■state  of  owing  money.  3  a  feeling  of 
gratitude  for  a  favour  or  service. 

— Oxford  English  Dictionary 

If  you  owe  the  bank  a  hundred  thou- 
sand dollars,  the  bank  owns  you.  If 
you  owe  the  bank  a  hundred  million 
dollars,  you  own  the  bank. 

— American  Proverb 

TWO  YEARS  AGO,  by  a  series  of  strange  coincidences,  I  found  myself 
attending  a  garden  party  at  Westminster  Abbey.  I  was  a  bit  uncom- 
fortable. It's  not  that  other  guests  weren't  pleasant  and  amicable,  and 
Father  Graeme,  who  had  organized  the  party,  was  nothing  if  not  a  gra- 
cious and  charming  host.  But  I  felt  more  than  a  little  out  of  place.  At 
one  point,  Father  Graeme  intervened,  saying  that  there  was  someone 
by  a  nearby  fountain  whom  I  would  certainly  want  to  meet.  She  turned 
out  to  be  a  trim,  well-appointed  young  woman  who,  he  explained,  was 
an  attorney — "but  more  of  the  activist  kind.  She  works  for  a  founda- 
tion that  provides  legal  support  for  anti-poverty  groups  in  London. 
You'll  probably  have  a  lot  to  talk  about." 

We  chatted.  She  told  me  about  her  job.  I  told  her  I  had  been 
involved  for  many  years  with  the  global  justice  movement — "anti- 
globalization  movement,"  as  it  was  usually  called  in  the  media.  She 
was  curious:  she'd  of  course  read  a  lot  about  Seattle,  Genoa,  the  tear 
gas  and  street  battles,  but  .  .  .  well,  had  we  really  accomplished  any- 
thing by  all  of  that? 

"Actually,"  I  said,  "I  think  it's  kind  of  amazing  how  much  we  did 
manage  to  accomplish  in  those  first  couple  of  years." 



"For  example?" 

"Well,  for  example,  we  managed  to  almost  completely  destroy 
the  IMF." 

As  it  happened,  she  didn't  actually  know  what  the  IMF  was,  so 
I  offered  that  the  International  Monetary  Fund  basically  acted  as  the 
world's  debt  enforcers — "You  might  say,  the  high-finance  equivalent 
of  the  guys  who  come  to  break  your  legs."  I  launched  into  historical 
background,  explaining  how,  during  the  '70s  oil  crisis,  OPEC  coun- 
tries ended  up  pouring  so  much  of  their  newfound  riches  into  Western 
banks  that  the  banks  couldn't  figure  out  where  to  invest  the  money; 
how  Citibank  and  Chase  therefore  began  sending  agents  around  the 
world  trying  to  convince  Third  World  dictators  and  politicians  to  take 
out  loans  (at  the  time,  this  was  called  "go-go  banking");  how  they 
started  out  at  extremely  low  rates  of  interest  that  almost  immediately 
skyrocketed  to  20  percent  or  so  due  to  tight  U.S.  money  policies  in  the 
early  '80s;  how,  during  the  '80s  and  '90s,  this  led  to  the  Third  World 
debt  crisis;  how  the  IMF  then  stepped  in  to  insist  that,  in  order  to 
obtain  refinancing,  poor  countries  would  be  obliged  to  abandon  price 
supports  on  basic  foodstuffs,  or  even  policies  of  keeping  strategic  food 
reserves,  and  abandon  free  health  care  and  free  education;  how  all  of 
this  had  led  to  the  collapse  of  all  the  most  basic  supports  for  some  of 
the  poorest  and  most  vulnerable  people  on  earth.  I  spoke  of  poverty, 
of  the  looting  of  public  resources,  the  collapse  of  societies,  endemic 
violence,  malnutrition,  hopelessness,  and  broken  lives. 

"But  what  was  your  position?"  the  lawyer  asked. 

"About  the  IMF?  We  wanted  to  abolish  it." 

"No,  I  mean,  about  the  Third  World  debt." 

"Oh,  we  wanted  to  abolish  that  too.  The  immediate  demand  was 
to  stop  the  IMF  from  imposing  structural  adjustment  policies,  which 
were  doing  all  the  direct  damage,  but  we  managed  to  accomplish  that 
surprisingly  quickly.  The  more  long-term  aim  was  debt  amnesty.  Some- 
thing along  the  lines  of  the  biblical  Jubilee.  As  far  as  we  were  con- 
cerned," I  told  her,  "thirty  years  of  money  flowing  from  the  poorest 
countries  to  the  richest  was  quite  enough." 

"But,"  she  objected,  as  if  this  were  self-evident,  "they'd  borrowed 
the  money!  Surely  one  has  to  pay  one's  debts." 

It  was  at  this  point  that  I  realized  this  was  going  to  be  a  very  dif- 
ferent sort  of  conversation  than  I  had  originally  anticipated. 

Where  to  start?  I  could  have  begun  by  explaining  how  these  loans 
had  originally  been  taken  out  by  unelected  dictators  who  placed  most 
of  it  directly  in  their  Swiss  bank  accounts,  and  ask  her  to  contemplate 
the  justice  of  insisting  that  the  lenders  be  repaid,  not  by  the  dictator, 



or  even  by  his  cronies,  but  by  literally  taking  food  from  the  mouths  of 
hungry  children.  Or  to  think  about  how  many  of  these  poor  countries 
had  actually  already  paid  back  what  they'd  borrowed  three  or  four 
times  now,  but  that  through  the  miracle  of  compound  interest,  it  still 
hadn't  made  a  significant  dent  in  the  principal.  I  could  also  observe 
that  there  was  a  difference  between  refinancing  loans,  and  demanding 
that  in  order  to  obtain  refinancing,  countries  have  to  follow  some  or- 
thodox free-market  economic  policy  designed  in  Washington  or  Zurich 
that  their  citizens  had  never  agreed  to  and  never  would,  and  that  it  was 
a  bit  dishonest  to  insist  that  countries  adopt  democratic  constitutions 
and  then  also  insist  that,  whoever  gets  elected,  they  have  no  control 
over  their  country's  policies  anyway.  Or  that  the  economic  policies 
imposed  by  the  IMF  didn't  even  work.  But  there  was  a  more  basic 
problem:  the  very  assumption  that  debts  have  to  be  repaid. 

Actually,  the  remarkable  thing  about  the  statement  "one  has  to 
pay  one's  debts"  is  that  even  according  to  standard  economic  theory, 
it  isn't  true.  A  lender  is  supposed  to  accept  a  certain  degree  of  risk.  If 
all  loans,  no  matter  how  idiotic,  were  still  retrievable — if  there  were  no 
bankruptcy  laws,  for  instance — the  results  would  be  disastrous.  What 
reason  would  lenders  have  not  to  make  a  stupid  loan? 

"Well,  I  know  that  sounds  like  common  sense,"  I  said,  "but  the 
funny  thing  is,  economically,  that's  not  how  loans  are  actually  sup- 
posed to  work.  Financial  institutions  are  supposed  to  be  ways  of  direct- 
ing resources  toward  profitable  investments.  If  a  bank  were  guaranteed 
to  get  its  money  back,  plus  interest,  no  matter  what  it  did,  the  whole 
system  wouldn't  work.  Say  I  were  to  walk  into  the  nearest  branch  of 
the  Royal  Bank  of  Scotland  and  say  'You  know,  I  just  got  a  really  great 
tip  on  the  horses.  Think  you  could  lend  me  a  couple  million  quid?' 
Obviously  they'd  just  laugh  at  me.  But  that's  just  because  they  know  if 
my  horse  didn't  come  in,  there'd  be  no  way  for  them  to  get  the  money 
back.  But,  imagine  there  was  some  law  that  said  they  were  guaranteed 
to  get  their  money  back  no  matter  what  happens,  even  if  that  meant,  I 
don't  know,  selling  my  daughter  into  slavery  or  harvesting  my  organs 
or  something.  Well,  in  that  case,  why  not?  Why  bother  waiting  for 
someone  to  walk  in  who  has  a  viable  plan  to  set  up  a  laundromat  or 
some  such?  Basically,  that's  the  situation  the  IMF  created  on  a  global 
level — which  is  how  you  could  have  all  those  banks  willing  to  fork 
over  billions  of  dollars  to  a  bunch  of  obvious  crooks  in  the  first  place." 

I  didn't  get  quite  that  far,  because  at  about  that  point  a  drunken 
financier  appeared,  having  noticed  that  we  were  talking  about  money, 
and  began  telling  funny  stories  about  moral  hazard — which  somehow, 



before  too  long,  had  morphed  into  a  long  and  not  particularly  engross- 
ing account  of  one  of  his  sexual  conquests.  I  drifted  off. 

Still,  for  several  days  afterward,  that  phrase  kept  resonating  in 
my  head. 

"Surely  one  has  to  pay  one's  debts." 

The  reason  it's  so  powerful  is  that  it's  not  actually  an  economic 
statement:  it's  a  moral  statement.  After  all,  isn't  paying  one's  debts 
what  morality  is  supposed  to  be  all  about?  Giving  people  what  is  due 
them.  Accepting  one's  responsibilities.  Fulfilling  one's  obligations  to 
others,  just  as  one  would  expect  them  to  fulfill  their  obligations  to  you. 
What  could  be  a  more  obvious  example  of  shirking  one's  responsibili- 
ties than  reneging  on  a  promise,  or  refusing  to  pay  a  debt? 

It  was  that  very  apparent  self-evidence,  I  realized,  that  made  the 
statement  so  insidious.  This  was  the  kind  of  line  that  could  make  ter- 
rible things  appear  utterly  bland  and  unremarkable.  This  may  sound 
strong,  but  it's  hard  not  to  feel  strongly  about  such  matters  once  you've 
witnessed  the  effects.  I  had.  For  almost  two  years,  I  had  lived  in  the 
highlands  of  Madagascar.  Shortly  before  I  arrived,  there  had  been  an 
outbreak  of  malaria.  It  was  a  particularly  virulent  outbreak  because 
malaria  had  been  wiped  out  in  highland  Madagascar  many  years  be- 
fore, so  that,  after  a  couple  of  generations,  most  people  had  lost  their 
immunity.  The  problem  was,  it  took  money  to  maintain  the  mosquito 
eradication  program,  since  there  had  to  be  periodic  tests  to  make  sure 
mosquitoes  weren't  starting  to  breed  again  and  spraying  campaigns  if  it 
was  discovered  that  they  were.  Not  a  lot  of  money.  But  owing  to  IMF- 
imposed  austerity  programs,  the  government  had  to  cut  the  monitoring 
program.  Ten  thousand  people  died.  I  met  young  mothers  grieving  for 
lost  children.  One  might  think  it  would  be  hard  to  make  a  case  that  the 
loss  of  ten  thousand  human  lives  is  really  justified  in  order  to  ensure 
that  Citibank  wouldn't  have  to  cut  its  losses  on  one  irresponsible  loan 
that  wasn't  particularly  important  to  its  balance  sheet  anyway.  But 
here  was  a  perfectly  decent  woman — one  who  worked  for  a  charitable 
organization,  no  less — who  took  it  as  self-evident  that  it  was.  After  all, 
they  owed  the  money,  and  surely  one  has  to  pay  one's  debts. 

For  the  next  few  weeks,  that  phrase  kept  coming  back  at  me.  Why 
debt?  What  makes  the  concept  so  strangely  powerful?  Consumer  debt 
is  the  lifeblood  of  our  economy.  All  modern  nation-states  are  built  on 
deficit  spending.  Debt  has  come  to  be  the  central  issue  of  international 



politics.  But  nobody  seems  to  know  exactly  what  it  is,  or  how  to  think 
about  it. 

The  very  fact  that  we  don't  know  what  debt  is,  the  very  flexibility 
of  the  concept,  is  the  basis  of  its  power.  If  history  shows  anything,  it 
is  that  there's  no  better  way  to  justify  relations  founded  on  violence, 
to  make  such  relations  seem  moral,  than  by  reframing  them  in  the 
language  of  debt — above  all,  because  it  immediately  makes  it  seem  that 
it's  the  victim  who's  doing  something  wrong.  Mafiosi  understand  this. 
So  do  the  commanders  of  conquering  armies.  For  thousands  of  years, 
violent  men  have  been  able  to  tell  their  victims  that  those  victims  owe 
them  something.  If  nothing  else,  they  "owe  them  their  lives"  (a  telling 
phrase)  because  they  haven't  been  killed. 

Nowadays,  for  example,  military  aggression  is  defined  as  a  crime 
against  humanity,  and  international  courts,  when  they  are  brought 
to  bear,  usually  demand  that  aggressors  pay  compensation.  Germa- 
ny had  to  pay  massive  reparations  after  World  War  I,  and  Iraq  is 
still  paying  Kuwait  for  Saddam  Hussein's  invasion  in  1990.  Yet  the 
Third  World  debt,  the  debt  of  countries  like  Madagascar,  Bolivia,  and 
the  Philippines,  seems  to  work  precisely  the  other  way  around.  Third 
World  debtor  nations  are  almost  exclusively  countries  that  have  at  one 
time  been  attacked  and  conquered  by  European  countries — often,  the 
very  countries  to  whom  they  now  owe  money.  In  1895,  for  example, 
France  invaded  Madagascar,  disbanded  the  government  of  then-Queen 
Ranavalona  III,  and  declared  the  country  a  French  colony.  One  of  the 
first  things  General  Gallieni  did  after  "pacification,"  as  they  liked  to 
call  it  then,  was  to  impose  heavy  taxes  on  the  Malagasy  population, 
in  part  so  they  could  reimburse  the  costs  of  having  been  invaded,  but 
also,  since  French  colonies  were  supposed  to  be  fiscally  self-supporting, 
to  defray  the  costs  of  building  the  railroads,  highways,  bridges,  planta- 
tions, and  so  forth  that  the  French  regime  wished  to  build.  Malagasy 
taxpayers  were  never  asked  whether  they  wanted  these  railroads,  high- 
ways, bridges,  and  plantations,  or  allowed  much  input  into  where  and 
how  they  were  built.1  To  the  contrary:  over  the  next  half  century,  the 
French  army  and  police  slaughtered  quite  a  number  of  Malagasy  who 
objected  too  strongly  to  the  arrangement  (upwards  of  half  a  million,  by 
some  reports,  during  one  revolt  in  1947).  It's  not  as  if  Madagascar  has 
ever  done  any  comparable  damage  to  France.  Despite  this,  from  the  be- 
ginning, the  Malagasy  people  were  told  they  owed  France  money,  and 
to  this  day,  the  Malagasy  people  are  still  held  to  owe  France  money, 
and  the  rest  of  the  world  accepts  the  justice  of  this  arrangement.  When 
the  "international  community"  does  perceive  a  moral  issue,  it's  usually 



when  they  feel  the  Malagasy  government  is  being  slow  to  pay  their 

But  debt  is  not  just  victor's  justice;  it  can  also  be  a  way  of  pun- 
ishing winners  who  weren't  supposed  to  win.  The  most  spectacular 
example  of  this  is  the  history  of  the  Republic  of  Haiti — the  first  poor 
country  to  be  placed  in  permanent  debt  peonage.  Haiti  was  a  nation 
founded  by  former  plantation  slaves  who  had  the  temerity  not  only 
to  rise  up  in  rebellion,  amidst  grand  declarations  of  universal  rights 
and  freedoms,  but  to  defeat  Napoleon's  armies  sent  to  return  them  to 
bondage.  France  immediately  insisted  that  the  new  republic  owed  it  150 
million  francs  in  damages  for  the  expropriated  plantations,  as  well  as 
the  expenses  of  outfitting  the  failed  military  expeditions,  and  all  other 
nations,  including  the  United  States,  agreed  to  impose  an  embargo  on 
the  country  until  it  was  paid.  The  sum  was  intentionally  impossible 
(equivalent  to  about  18  billion  dollars),  and  the  resultant  embargo  en- 
sured that  the  name  "Haiti"  has  been  a  synonym  for  debt,  poverty,  and 
human  misery  ever  since.2 

Sometimes,  though,  debt  seems  to  mean  the  very  opposite.  Starting 
in  the  1980s,  the  United  States,  which  insisted  on  strict  terms  for  the  re- 
payment of  Third  World  debt,  itself  accrued  debts  that  easily  dwarfed 
those  of  the  entire  Third  World  combined — mainly  fueled  by  military 
spending.  The  U.S.  foreign  debt,  though,  takes  the  form  of  treasury 
bonds  held  by  institutional  investors  in  countries  (Germany,  Japan, 
South  Korea,  Taiwan,  Thailand,  the  Gulf  States)  that  are  in  most  cases, 
effectively,  U.S.  military  protectorates,  most  covered  in  U.S.  bases  full 
of  arms  and  equipment  paid  for  with  that  very  deficit  spending.  This 
has  changed  a  little  now  that  China  has  gotten  in  on  the  game  (China 
is  a  special  case,  for  reasons  that  will  be  explained  later),  but  not  very 
much — even  China  finds  that  the  fact  it  holds  so  many  U.S.  treasury 
bonds  makes  it  to  some  degree  beholden  to  U.S.  interests,  rather  than 
the  other  way  around. 

So  what  is  the  status  of  all  this  money  continually  being  funneled 
into  the  U.S.  treasury?  Are  these  loans?  Or  is  it  tribute?  In  the  past, 
military  powers  that  maintained  hundreds  of  military  bases  outside 
their  own  home  territory  were  ordinarily  referred  to  as  "empires,"  and 
empires  regularly  demanded  tribute  from  subject  peoples.  The  U.S. 
government,  of  course,  insists  that  it  is  not  an  empire — but  one  could 
easily  make  a  case  that  the  only  reason  it  insists  on  treating  these  pay- 
ments as  "loans"  and  not  as  "tribute"  is  precisely  to  deny  the  reality 
of  what's  going  on. 

Now,  it's  true  that,  throughout  history,  certain  sorts  of  debt,  and 
certain  sorts  of  debtor,  have  always  been  treated  differently  than 



others.  In  the  1720s,  one  of  the  things  that  most  scandalized  the  British 
public  when  conditions  at  debtors'  prisons  were  exposed  in  the  popular 
press  was  the  fact  that  these  prisons  were  regularly  divided  into  two 
sections.  Aristocratic  inmates,  who  often  thought  of  a  brief  stay  in  Fleet 
or  Marshalsea  as  something  of  a  fashion  statement,  were  wined  and 
dined  by  liveried  servants  and  allowed  to  receive  regular  visits  from 
prostitutes.  On  the  "common  side,"  impoverished  debtors  were  shack- 
led together  in  tiny  cells,  "covered  with  filth  and  vermin,"  as  one  report 
put  it,  "and  suffered  to  die,  without  pity,  of  hunger  and  jail  fever.'" 

In  a  way  you  can  see  current  world  economic  arrangements  as  a 
much  larger  version  of  the  same  thing:  the  U.S.  in  this  case  being  the 
Cadillac  debtor,  Madagascar  the  pauper  starving  in  the  next  cell — 
while  the  Cadillac  debtors'  servants  lecture  him  on  how  his  problems 
are  due  to  his  own  irresponsibility. 

And  there's  something  more  fundamental  going  on  here,  a  philo- 
sophical question,  even,  that  we  might  do  well  to  contemplate.  What 
is  the  difference  between  a  gangster  pulling  out  a  gun  and  demand- 
ing you  give  him  a  thousand  dollars  of  "p/otection  money,"  and  that 
same  gangster  pulling  out  a  gun  and  demanding  you  provide  him  with 
a  thousand-dollar  "loan"?  In  most  ways,  obviously,  nothing.  But  in 
certain  ways  there  is  a  difference.  As  in  the  case  of  the  U.S.  debt  to 
Korea  or  Japan,  were  the  balance  of  power  at  any  point  to  shift,  were 
America  to  lose  its  military  supremacy,  were  the  gangster  to  lose  his 
henchmen,  that  "loan"  might  start  being  treated  very  differently.  It 
might  become  a  genuine  liability.  But  the  crucial  element  would  still 
seem  to  be  the  gun. 

There's  an  old  vaudeville  gag  that  makes  the  same  point  even  more 
elegantly — here,  as  improved  on  by  Steve  Wright: 

I  was  walking  down  the  street  with  a  friend  the  other  day  and 
a  guy  with  a  gun  jumps  out  of  an  alley  and  says  "stick  'em  up." 

As  I  pull  out  my  wallet,  I  figure,  "shouldn't  be  a  total  loss." 
So  I  pull  out  some  money,  turn  to  my  friend  and  say,  "Hey, 
Fred,  here's  that  fifty  bucks  I  owe  you." 

The  robber  was  so  offended  he  took  out  a  thousand  dollars 
of  his  own  money,  forced  Fred  to  lend  it  to  me  at  gunpoint, 
and  then  took  it  back  again. 

In  the  final  analysis,  the  man  with  the  gun  doesn't  have  to  do  anything 
he  doesn't  want  to  do.  But  in  order  to  be  able  to  run  even  a  regime 
based  on  violence  effectively,  one  needs  to  establish  some  kind  of  set  of 
rules.  The  rules  can  be  completely  arbitrary.  In  a  way  it  doesn't  even 



matter  what  they  are.  Or,  at  least,  it  doesn't  matter  at  first.  The  prob- 
lem is,  the  moment  one  starts  framing  things  in  terms  of  debt,  people 
will  inevitably  start  asking  who  really  owes  what  to  whom. 

Arguments  about  debt  have  been  going  on  for  at  least  five  thou- 
sand years.  For  most  of  human  history — at  least,  the  history  of  states 
and  empires — most  human  beings  have  been  told  that  they  are  debt- 
ors.4 Historians,  and  particularly  historians  of  ideas,  have  been  oddly 
reluctant  to  consider  the  human  consequences;  especially  since  this 
situation — more  than  any  other — has  caused  continual  outrage  and  re- 
sentment. Tell  people  they  are  inferior,  they  are  unlikely  to  be  pleased, 
but  this  surprisingly  rarely  leads  to  armed  revolt.  Tell  people  that  they 
are  potential  equals  who  have  failed,  and  that  therefore,  even  what 
they  do  have  they  do  not  deserve,  that  it  isn't  rightly  theirs,  and  you 
are  much  more  likely  to  inspire  rage.  Certainly  this  is  what  history 
would  seem  to  teach  us.  For  thousands  of  years,  the  struggle  between 
rich  and  poor  has  largely  taken  the  form  of  conflicts  between  creditors 
and  debtors — of  arguments  about  the  rights  and  wrongs  of  interest 
payments,  debt  peonage,  amnesty,  repossession,  restitution,  the  seques- 
tering of  sheep,  the  seizing  of  vineyards,  and  the  selling  of  debtors'  chil- 
dren into  slavery.  By  the  same  token,  for  the  last  five  thousand  years, 
with  remarkable  regularity,  popular  insurrections  have  begun  the  same 
way:  with  the  ritual  destruction  of  the  debt  records — tablets,  papyri, 
ledgers,  whatever  form  they  might  have  taken  in  any  particular  time 
and  place.  (After  that,  rebels  usually  go  after  the  records  of  landholding 
and  tax  assessments.)  As  the  great  classicist  Moses  Finley  often  liked 
to  say,  in  the  ancient  world,  all  revolutionary  movements  had  a  single 
program:  "Cancel  the  debts  and  redistribute  the  land."5 

Our  tendency  to  overlook  this  is  all  the  more  peculiar  when  you 
consider  how  much  of  our  contemporary  moral  and  religious  language 
originally  emerged  directly  from  these  very  conflicts.  Terms  like  "reck- 
oning" or  "redemption"  are  only  the  most  obvious,  since  they're  taken 
directly  from  the  language  of  ancient  finance.  In  a  larger  sense,  the 
same  can  be  said  of  "guilt,"  "freedom,"  "forgiveness,"  and  even  "sin." 
Arguments  about  who  really  owes  what  to  whom  have  played  a  central 
role  in  shaping  our  basic  vocabulary  of  right  and  wrong. 

The  fact  that  so  much  of  this  language  did  take  shape  in  arguments 
about  debt  has  left  the  concept  strangely  incoherent.  After  all,  to  argue 
with  the  king,  one  has  to  use  the  king's  language,  whether  or  not  the 
initial  premises  make  sense. 

If  one  looks  at  the  history  of  debt,  then,  what  one  discovers  first 
of  all  is  profound  moral  confusion.  Its  most  obvious  manifestation  is 
that  most  everywhere,  one  finds  that  the  majority  of  human  beings 



hold  simultaneously  that  (i)  paying  back  money  one  has  borrowed  is 
a  simple  matter  of  morality,  and  (2)  anyone  in  the  habit  of  lending 
money  is  evil. 

It's  true  that  opinions  on  this  latter  point  do  shift  back  and  forth. 
One  extreme  possibility  might  be  the  situation  the  French  anthropolo- 
gist Jean-Claude  Galey  encountered  in  a  region  of  the  eastern  Himala- 
yas, where  as  recently  as  the  1970s,  the  low-ranking  castes — they  were 
referred  to  as  "the  vanquished  ones,"  since  they  were  thought  to  be 
descended  from  a  population  once  conquered  by  the  current  landlord 
caste,  many  centuries  before — lived  in  a  situation  of  permanent  debt 
dependency.  Landless  and  penniless,  they  were  obliged  to  solicit  loans 
from  the  landlords  simply  to  find  a  way  to  eat — not  for  the  money, 
since  the  sums  were  paltry,  but  because  poor  debtors  were  expected 
to  pay  back  the  interest  in  the  form  of  work,  which  meant  they  were 
at  least  provided  with  food  and  shelter  while  they  cleaned  out  their 
creditors'  outhouses  and  reroofed  their  sheds.  For  the  "vanquished" — 
as  for  most  people  in  the  world,  actually — the  most  significant  life 
expenses  were  weddings  and  funerals.  These  required  a  good  deal  of 
money,  which  always  had  to  be  borrowed.  In  such  cases  it  was  com- 
mon practice,  Galey  explains,  for  high-caste  moneylenders  to  demand 
one  of  the  borrower's  daughters  as  security.  Often,  when  a  poor  man 
had  to  borrow  money  for  his  daughter's  marriage,  the  security  would 
be  the  bride  herself.  She  would  be  expected  to  report  to  the  lender's 
household  after  her  wedding  night,  spend  a  few  months  there  as  his 
concubine,  and  then,  once  he  grew  bored,  be  sent  off  to  some  nearby 
timber  camp,  where  she  would  have  to  spend  the  next  year  or  two  as 
a  prostitute  working  off  her  father's  debt.  Once  it  was  paid  off,  she'd 
return  to  her  husband  and  begin  her  married  life.6 

This  seems  shocking,  outrageous  even,  but  Galey  does  not  report 
any  widespread  feeling  of  injustice.  Everyone  seemed  to  feel  that  this 
was  just  the  way  things  worked.  Neither  was  there  much  concern 
voiced  among  the  local  Brahmins,  who  were  the  ultimate  arbiters  in 
matters  of  morality — though  this  is  hardly  surprising,  since  the  most 
prominent  moneylenders  were  often  Brahmins  themselves. 

Even  here,  of  course,  it's  hard  to  know  what  people  were  saying 
behind  closed  doors.  If  a  group  of  Maoist  rebels  were  to  suddenly  seize 
control  of  the  area  (some  do  operate  in  this  part  of  rural  India)  and 
round  up  the  local  usurers  for  trial,  we  might  hear  all  sorts  of  views 

Still,  what  Galey  describes  represents,  as  I  say,  one  extreme  of 
possibility:  one  in  which  the  usurers  themselves  are  the  ultimate  moral 
authorities.  Compare  this  with,  say,  medieval  France,  where  the  moral 



status  of  moneylenders  was  seriously  in  question.  The  Catholic  Church 
had  always  forbidden  the  practice  of  lending  money  at  interest,  but 
the  rules  often  fell  into  desuetude,  causing  the  Church  hierarchy  to 
authorize  preaching  campaigns,  sending  mendicant  friars  to  travel  from 
town  to  town  warning  usurers  that  unless  they  repented  and  made 
full  restitution  of  all  interest  extracted  from  their  victims,  they  would 
surely  go  to  Hell. 

These  sermons,  many  of  which  have  survived,  are  full  of  horror 
stories  of  God's  judgment  on  unrepentant  lenders:  stories  of  rich  men 
struck  down  by  madness  or  terrible  diseases,  haunted  by  deathbed 
nightmares  of  the  snakes  or  demons  who  would  soon  rend  or  eat 
their  flesh.  In  the  twelfth  century,  when  such  campaigns  reached  their 
heights,  more  direct  sanctions  began  to  be  employed.  The  papacy  is- 
sued instructions  to  local  parishes  that  all  known  usurers  were  to  be 
excommunicated;  they  were  not  to  be  allowed  to  receive  the  sacra- 
ments, and  under  no  conditions  could  their  bodies  be  buried  on  hal- 
lowed ground.  One  French  cardinal,  Jacques  de  Vitry,  writing  around 
1210,  recorded  the  story  of  a  particularly  influential  moneylender  whose 
friends  tried  to  pressure  their  parish  priest  to  overlook  the  rules  and 
allow  him  to  be  buried  in  the  local  churchyard: 

Since  the  dead  usurer's  friends  were  very  insistent,  the  priest 
yielded  to  their  pressure  and  said,  "Let  us  put  his  body  on  a 
donkey  and  see  God's  will,  and  what  He  will  do  with  the  body. 
Wherever  the  donkey  takes  it,  be  it  a  church,  a  cemetery,  or 
elsewhere,  there  will  I  bury  it."  The  body  was  placed  upon  the 
donkey  which  without  deviating  either  to  right  or  left,  took  it 
straight  out  of  town  to  the  place  where  thieves  are  hanged  from 
the  gibbet,  and  with  a  hearty  buck,  sent  the  cadaver  flying  into 
the  dung  beneath  the  gallows.7 

Looking  over  world  literature,  it  is  almost  impossible  to  find  a  single 
sympathetic  representation  of  a  moneylender — or  anyway,  a  profes- 
sional moneylender,  which  means  by  definition  one  who  charges  inter- 
est. I'm  not  sure  there  is  another  profession  (executioners?)  with  such 
a  consistently  bad  image.  It's  especially  remarkable  when  one  considers 
that  unlike  executioners,  usurers  often  rank  among  the  richest  and 
most  powerful  people  in  their  communities.  Yet  the  very  name,  "usu- 
rer," evokes  images  of  loan  sharks,  blood  money,  pounds  of  flesh,  the 
selling  of  souls,  and  behind  them  all,  the  Devil,  often  represented  as 
himself  a  kind  of  usurer,  an  evil  accountant  with  his  books  and  ledgers, 
or  alternately,  as  the  figure  looming  just  behind  the  usurer,  biding  his 



time  until  he  can  repossess  the  soul  of  a  villain  who,  by  his  very  oc- 
cupation, has  clearly  made  a  compact  with  Hell. 

Historically,  there  have  been  only  two  effective  ways  for  a  lender 
to  try  to  wriggle  out  of  the  opprobrium:  either  shunt  off  responsibility 
onto  some  third  party,  or  insist  that  the  borrower  is  even  worse.  In  me- 
dieval Europe,  for  instance,  lords  often  took  the  first  approach,  employ- 
ing Jews  as  surrogates.  Many  would  even  speak  of  "our"  Jews — that  is, 
Jews  under  their  personal  protection — though  in  practice  this  usually 
meant  that  they  would  first  deny  Jews  in  their  territories  any  means 
of  making  a  living  except  by  usury  (guaranteeing  that  they  would,  be 
widely  detested),  then  periodically  turn  on  them,  claiming  they  were 
detestable  creatures,  and  take  the  money  for  themselves.  The  second 
approach  is  of  course  more  common.  But  it  usually  leads  to  the  conclu- 
sion that  both  parties  to  a  loan  are  equally  guilty;  the  whole  affair  is  a 
shabby  business;  and  most  likely,  both  are  damned. 

Other  religious  traditions  have  different  perspectives.  In  medieval 
Hindu  law  codes,  not  only  were  interest-bearing  loans  permissible  (the 
main  stipulation  was  that  interest  should  never  exceed  principal),  but 
it  was  often  emphasized  that  a  debtor  who  did  not  pay  would  be 
reborn  as  a  slave  in  the  household  of  his  creditor — or  in  later  codes, 
reborn  as  his  horse  or  ox.  The  same  tolerant  attitude  toward  lenders, 
and  warnings  of  karmic  revenge  against  borrowers,  reappear  in  many 
strands  of  Buddhism.  Even  so,  the  moment  that  usurers  were  thought 
to  go  too  far,  exactly  the  same  sort  of  stories  as  found  in  Europe  would 
start  appearing.  A  Medieval  Japanese  author  recounts  one — he  insists 
it's  a  true  story — about  the  terrifying  fate  of  Hiromushime,  the  wife 
of  a  wealthy  district  governor  around  776  ad.  An  exceptionally  greedy 

she  would  add  water  to  the  rice  wine  she  sold  and  make  a 
huge  profit  on  such  diluted  sake.  On  the  day  she  loaned  some- 
thing to  someone  she  would  use  a  small  measuring  cup,  but 
on  the  day  of  collection  she  used  a  large  one.  When  lending 
rice  her  scale  registered  small  portions,  but  when  she  received 
payment  it  was  in  large  amounts.  The  interest  that  she  forcibly 
collected  was  tremendous — often  as  much  as  ten  or  even  one 
hundred  times  the  amount  of  the  original  loan.  She  was  rigid 
about  collecting  debts,  showing  no  mercy  whatsoever.  Because 
of  this,  many  people  were  thrown  into  a  state  of  anxiety;  they 
abandoned  their  households  to  get  away  from  her  and  took  to 
wandering  in  other  provinces.8 



After  she  died,  for  seven  days,  monks  prayed  over  her  sealed  coffin.  On 
the  seventh,  her  body  mysteriously  sprang  to  life: 

Those  who  came  to  look  at  her  encountered  an  indescribable 
stench.  From  the  waist  up  she  had  already  become  an  ox  with 
four-inch  horns  protruding  from  her  forehead.  Her  two  hands 
had  become  the  hooves  of  an  ox,  her  nails  were  now  cracked  so 
that  they  resembled  an  ox  hoof's  instep.  From  the  waist  down, 
however,  her  body  was  that  of  a  human.  She  disliked  rice  and 
preferred  to  eat  grass.  Her  manner  of  eating  was  rumination. 
Naked,  she  would  lie  in  her  own  excrement.9 

Gawkers  descended.  Guilty  and  ashamed,  the  family  made  desperate 
attempts  to  buy  forgiveness,  canceling  all  debts  owed  to  them  by  any- 
body, donating  much  of  their  wealth  to  religious  establishments.  Fi- 
nally, mercifully,  the  monster  died. 

The  author,  himself  a  monk,  felt  that  the  story  represented  a  clear 
case  of  premature  reincarnation — the  woman  was  being  punished  by 
the  law  of  karma  for  her  violations  of  "what  is  both  reasonable  and 
right."  His  problem  was  that  Buddhist  scriptures,  insofar  as  they  ex- 
plicitly weighed  in  on  the  matter,  didn't  provide  a  precedent.  Normally, 
it  was  debtors  who  were  supposed  to  be  reborn  as  oxen,  not  creditors. 
As  a  result,  when  it  came  time  to  explain  the  moral  of  the  story,  his 
exposition  grew  decidedly  confusing: 

It  is  as  one  sutra  says:  "When  we  do  not  repay  the  things  that 
we  have  borrowed,  our  payment  becomes  that  of  being  reborn 
as  a  horse  or  ox."  "The  debtor  is  like  a  slave,  the  creditor  is 
like  a  master."  Or  again:  "a  debtor  is  a  pheasant  and  his  credi- 
tor a  hawk."  If  you  are  in  a  situation  of  having  granted  a  loan, 
do  not  put  unreasonable  pressure  on  your  debtor  for  repay- 
ment. If  you  do,  you  will  be  reborn  as  a  horse  or  an  ox  and  be 
put  to  work  for  him  who  was  in  debt  to  you,  and  then  you  will 
repay  many  times  over.10 

So  which  will  it  be?  They  can't  both  end  up  as  animals  in  each  other's 

All  the  great  religious  traditions  seem  to  bang  up  against  this  quan- 
dary in  one  form  or  another.  On  the  one  hand,  insofar  as  all  human  re- 
lations involve  debt,  they  are  all  morally  compromised.  Both  parties  are 
probably  already  guilty  of  something  just  by  entering  into  the  relation- 
ship; at  the  very  least  they  run  a  significant  danger  of  becoming  guilty 



if  repayment  is  delayed.  On  the  other  hand,  when  we  say  someone  acts 
like  they  "don't  owe  anything  to  anybody,"  we're  hardly  describing  the 
person  as  a  paragon  of  virtue.  In  the  secular  world,  morality  consists 
largely  of  fulfilling  our  obligations  to  others,  and  we  have  a  stubborn 
tendency  to  imagine  those  obligations  as  debts.  Monks,  perhaps,  can 
avoid  the  dilemma  by  detaching  themselves  from  the  secular  world 
entirely,  but  the  rest  of  us  appear  condemned  to  live  in  a  universe  that 
doesn't  make  a  lot  of  sense. 

The  story  of  Hiromushime  is  a  perfect  illustration  of  the  impulse  to 
throw  the  accusation  back  at  the  accuser — just  as  in  the  story  about 
the  dead  usurer  and  the  donkey,  the  emphasis  on  excrement,  animals, 
and  humiliation  is  clearly  meant  as  poetic  justice,  the  creditor  forced  to 
experience  the  same  feelings  of  disgrace  and  degradation  that  debtors 
are  always  made  to  feel.  It's  all  a  more  vivid,  more  visceral  way  of  ask- 
ing that  same  question:  "Who  really  owes  what  to  whom?" 

It's  also  a  perfect  illustration  of  how  the  moment  one  asks  the 
question  "Who  really  owes  what  to  whom?,"  one  has  begun  to  adopt 
the  creditor's  language.  Just  as  if  we  don't  pay  our  debts,  "our  payment 
becomes  that  of  being  reborn  as  a  horse  or  an  ox";  so  if  you  are  an 
unreasonable  creditor,  you  too  will  "repay."  Even  karmic  justice  can 
thus  be  reduced  to  the  language  of  a  business  deal. 

Here  we  come  to  the  central  question  of  this  book:  What,  precisely, 
does  it  mean  to  say  that  our  sense  of  morality  and  justice  is  reduced  to 
the  language  of  a  business  deal?  What  does  it  mean  when  we  reduce 
moral  obligations  to  debts?  What  changes  when  the  one  turns  into 
the  other?  And  how  do  we  speak  about  them  when  our  language  has 
been  so  shaped  by  the  market?  On  one  level  the  difference  between  an 
obligation  and  a  debt  is  simple  and  obvious.  A  debt  is  the  obligation 
to  pay  a  certain  sum  of  money.  As  a  result,  a  debt,  unlike  any  other 
form  of  obligation,  can  be  precisely  quantified.  This  allows  debts  to 
become  simple,  cold,  and  impersonal — which,  in  turn,  allows  them  to 
be  transferable.  If  one  owes  a  favor,  or  one's  life,  to  another  human 
being — it  is  owed  to  that  person  specifically.  But  if  one  owes  forty 
thousand  dollars  at  12-percent  interest,  it  doesn't  really  matter  who  the 
creditor  is;  neither  does  either  of  the  two  parties  have  to  think  much 
about  what  the  other  party  needs,  wants,  is  capable  of  doing — as  they 
certainly  would  if  what  was  owed  was  a  favor,  or  respect,  or  gratitude. 
One  does  not  need  to  calculate  the  human  effects;  one  need  only  cal- 
culate principal,  balances,  penalties,  and  rates  of  interest.  If  you  end 



up  having  to  abandon  your  home  and  wander  in  other  provinces,  if 
your  daughter  ends  up  in  a  mining  camp  working  as  a  prostitute,  well, 
that's  unfortunate,  but  incidental  to  the  creditor.  Money  is  money,  and 
a  deal's  a  deal. 

From  this  perspective,  the  crucial  factor,  and  a  topic  that  will  be 
explored  at  length  in  these  pages,  is  money's  capacity  to  turn  moral- 
ity into  a  matter  of  impersonal  arithmetic — and  by  doing  so,  to  justify 
things  that  would  otherwise  seem  outrageous  or  obscene.  The  factor 
of  violence,  which  I  have  been  emphasizing  up  until  now,  may  appear 
secondary.  The  difference  between  a  "debt"  and  a  mere  moral  obliga- 
tion is  not  the  presence  or  absence  of  men  with  weapons  who  can  en- 
force that  obligation  by  seizing  the  debtor's  possessions  or  threatening 
to  break  his  legs.  It  is  simply  that  a  creditor  has  the  means  to  specify, 
numerically,  exactly  how  much  the  debtor  owes. 

However,  when  one  looks  a  little  closer,  one  discovers  that  these 
two  elements — the  violence  and  the  quantification — are  intimately 
linked.  In  fact  it's  almost  impossible  to  find  one  without  the  other. 
French  usurers  had  powerful  friends  and  enforcers,  capable  of  bullying 
even  Church  authorities.  How  else  would  they  have  collected  debts 
that  were  technically  illegal?  Hiromushime  was  utterly  uncompromis- 
ing with  her  debtors — "showing  no  mercy  whatsoever" — but  then,  her 
husband  was  the  governor.  She  didn't  have  to  show  mercy.  Those 
of  us  who  do  not  have  armed  men  behind  us  cannot  afford  to  be 
so  exacting. 

The  way  violence,  or  the  threat  of  violence,  turns  human  relations 
into  mathematics  will  crop  up  again  and  again  over  the  course  of  this 
book.  It  is  the  ultimate  source  of  the  moral  confusion  that  seems  to 
float  around  everything  surrounding  the  topic  of  debt.  The  resulting 
dilemmas  appear  to  be  as  old  as  civilization  itself.  We  can  observe  the 
process  in  the  very  earliest  records  from  ancient  Mesopotamia;  it  finds 
its  first  philosophical  expression  in  the  Vedas,  reappears  in  endless 
forms  throughout  recorded  history,  and  still  lies  underneath  the  essen- 
tial fabric  of  our  institutions  today — state  and  market,  our  most  basic 
conceptions  of  the  nature  of  freedom,  morality,  sociality — all  of  which 
have  been  shaped  by  a  history  of  war,  conquest,  and  slavery  in  ways 
we're  no  longer  capable  of  even  perceiving  because  we  can  no  longer 
imagine  things  any  other  way. 

There  are  obvious  reasons  why  this  is  a  particularly  important  moment 
to  reexamine  the  history  of  debt.  September  2008  saw  the  beginning  of 



a  financial  crisis  that  almost  brought  the  entire  world  economy  screech- 
ing to  a  halt.  In  many  ways  the  world  economy  did:  ships  stopped 
moving  across  the  oceans,  and  thousands  were  placed  in  dry  dock. 
Building  cranes  were  dismantled,  as  no  more  buildings  were  being  put 
up.  Banks  largely  ceased  making  loans.  In  the  wake  of  this,  there  was 
not  only  public  rage  and  bewilderment,  but  the  beginning  of  an  actual 
public  conversation  about  the  nature  of  debt,  of  money,  of  the  financial 
institutions  that  have  come  to  hold  the  fate  of  nations  in  their  grip. 

But  that  was  just  a  moment.  The  conversation  never  ended  up  tak- 
ing place. 

The  reason  that  people  were  ready  for  such  a  conversation  was 
that  the  story  everyone  had  been  told  for  the  last  decade  or  so  had  just 
been  revealed  to  be  a  colossal  lie.  There's  really  no  nicer  way  to  say 
it.  For  years,  everyone  had  been  hearing  of  a  whole  host  of  new,  ultra- 
sophisticated  financial  innovations:  credit  and  commodity  derivatives, 
collateralized  mortgage  obligation  derivatives,  hybrid  securities,  debt 
swaps,  and  so  on.  These  new  derivative  markets  were  so  incredibly 
sophisticated,  that — according  to  one  persistent  story — a  prominent  in- 
vestment house  had  to  employ  astrophysicists  to  run  trading  programs 
so  complex  that  even  the  financiers  couldn't  begin  to  understand  them. 
The  message  was  transparent:  leave  these  things  to  the  professionals. 
You  couldn't  possibly  get  your  minds  around  this.  Even  if  you  don't 
like  financial  capitalists  very  much  (and  few  seemed  inclined  to  argue 
that  there  was  much  to  like  about  them),  they  were  nothing  if  not  capa- 
ble, in  fact  so  preternaturally  capable,  that  democratic  oversight  of  fi- 
nancial markets  was  simply  inconceivable.  (Even  a  lot  of  academics  fell 
for  it.  I  well  remember  going  to  conferences  in  2006  and  2007  where 
trendy  social  theorists  presented  papers  arguing  that  these  new  forms 
of  securitization,  linked  to  new  information  technologies,  heralded  a 
looming  transformation  in  the  very  nature  of  time,  possibility — reality 
itself.  I  remember  thinking:  "Suckers!"  And  so  they  were.) 

Then,  when  the  rubble  had  stopped  bouncing,  it  turned  out  that 
many  if  not  most  of  them  had  been  nothing  more  than  very  elaborate 
scams.  They  consisted  of  operations  like  selling  poor  families  mort- 
gages crafted  in  such  a  way  as  to  make  eventual  default  inevitable; 
taking  bets  on  how  long  it  would  take  the  holders  to  default;  packag- 
ing mortgage  and  bet  together  and  selling  them  to  institutional  inves- 
tors (representing,  perhaps,  the  mortgage-holders'  retirement  accounts) 
claiming  that  it  would  make  money  no  matter  what  happened,  and  al- 
low said  investors  to  pass  such  packages  around  as  if  they  were  money; 
turning  over  responsibility  for  paying  off  the  bet  to  a  giant  insurance 
conglomerate  that,  were  it  to  sink  beneath  the  weight  of  its  resultant 



debt  (which  certainly  would  happen),  would  then  have  to  be  bailed  out 
by  taxpayers  (as  such  conglomerates  were  indeed  bailed  out).11  In  other 
words,  it  looks  very  much  like  an  unusually  elaborate  version  of  what 
banks  were  doing  when  they  lent  money  to  dictators  in  Bolivia  and 
Gabon  in  the  late  '70s:  make  utterly  irresponsible  loans  with  the  full 
knowledge  that,  once  it  became  known  they  had  done  so,  politicians 
and  bureaucrats  would  scramble  to  ensure  that  they'd  still  be  reim- 
bursed anyway,  no  matter  how  many  human  lives  had  to  be  devastated 
and  destroyed  in  order  to  do  it. 

The  difference,  though,  was  that  this  time,  the  bankers  were  doing 
it  on  an  inconceivable  scale:  the  total  amount  of  debt  they  had  run  up 
was  larger  than  the  combined  Gross  Domestic  Products  of  every  coun- 
try in  the  world — and  it  threw  the  world  into  a  tailspin  and  almost 
destroyed  the  system  itself. 

Armies  and  police  geared  up  to  combat  the  expected  riots  and 
unrest,  but  none  materialized.  But  neither  have  any  significant  changes 
in  how  the  system  is  run.  At  the  time,  everyone  assumed  that,  with  the 
very  defining  institutions  of  capitalism  (Lehman  Brothers,  Citibank, 
General  Motors)  crumbling,  and  all  claims  to  superior  wisdom  revealed 
to  be  false,  we  would  at  least  restart  a  broader  conversation  about  the 
nature  of  debt  and  credit  institutions.  And  not  just  a  convwersation. 

It  seemed  that  most  Americans  were  open  to  radical  solutions. 
Surveys  showed  that  an  overwhelming  majority  of  Americans  felt  that 
the  banks  should  not  be  rescued,  whatever  the  economic  consequences, 
but  that  ordinary  citizens  stuck  with  bad  mortgages  should  be  bailed 
out.  In  the  United  States  this  is  quite  extraordinary.  Since  colonial  days, 
Americans  have  been  the  population  least  sympathetic  to  debtors.  In  a 
way  this  is  odd,  since  America  was  settled  largely  by  absconding  debt- 
ors, but  it's  a  country  where  the  idea  that  morality  is  a  matter  of  pay- 
ing one's  debts  runs  deeper  than  almost  any  other.  In  colonial  days,  an 
insolvent  debtor's  ear  was  often  nailed  to  a  post.  The  United  States  was 
one  of  the  last  countries  in  the  world  to  adopt  a  law  of  bankruptcy:  de- 
spite the  fact  that  in  1787,  the  Constitution  specifically  charged  the  new 
government  with  creating  one,  all  attempts  were  rejected  on  "moral 
grounds"  until  1898. 12  The  change  was  epochal.  For  this  very  reason, 
perhaps,  those  in  charge  of  moderating  debate  in  the  media  and  legisla- 
tures decided  that  this  was  not  the  time.  The  United  States  government 
effectively  put  a  three-trillion-dollar  Band-Aid  over  the  problem  and 
changed  nothing.  The  bankers  were  rescued;  small-scale  debtors — with 
a  paltry  few  exceptions — were  not.13  To  the  contrary,  in  the  middle  of 
the  greatest  economic  recession  since  the  '30s,  we  are  already  begin- 
ning to  see  a  backlash  against  them — driven  by  financial  corporations 



who  have  now  turned  to  the  same  government  that  bailed  them  out 
to  apply  the  full  force  of  the  law  against  ordinary  citizens  in  financial 
trouble.  "It's  not  a  crime  to  owe  money,"  reports  the  Minneapolis-St. 
Paul  StarTribune,  "But  people  are  routinely  being  thrown  in  jail  for 
failing  to  pay  debts."  In  Minnesota,  "the  use  of  arrest  warrants  against 
debtors  has  jumped  60  percent  over  the  past  four  years,  with  845  cases 
in  2009  ...  In  Illinois  and  southwest  Indiana,  some  judges  jail  debtors 
for  missing  court-ordered  debt  payments.  In  extreme  cases,  people  stay 
in  jail  until  they  raise  a  minimum  payment.  In  January  [2010],  a  judge 
sentenced  a  Kenney,  111.,  man  'to  indefinite  incarceration'  until  he  came 
up  with  $300  toward  a  lumber  yard  debt."14 

In  other  words,  we  are  moving  toward  a  restoration  of  some- 
thing much  like  debtors'  prisons.  Meanwhile,  the  conversation  stopped 
dead,  popular  rage  against  bailouts  sputtered  into  incoherence,  and 
we  seem  to  be  tumbling  inexorably  toward  the  next  great  financial 
catastrophe — the  only  real  question  being  just  how  long  it  will  take. 

We  have  reached  the  point  at  which  the  IMF  itself,  now  trying  to 
reposition  itself  as  the  conscience  of  global  capitalism,  has  begun  to 
issue  warnings  that  if  we  continue  on  the  present  course,  no  bailout 
is  likely  to  be  forthcoming  the  next  time.  The  public  simply  will  not 
stand  for  it,  and  as  a  result,  everything  really  will  come  apart.  "IMF 
Warns  Second  Bailout  Would  'Threaten  Democracy'"  reads  one  recent 
headline.15  (Of  course  by  "democracy"  they  mean  "capitalism.")  Surely 
it  means  something  that  even  those  who  feel  they  are  responsible  for 
keeping  the  current  global  economic  system  running,  who  just  a  few 
years  ago  acted  as  if  they  could  simply  assume  the  current  system 
would  be  around  forever,  are  now  seeing  apocalypse  everywhere. 

In  this  case,  the  IMF  has  a  point.  We  have  every  reason  to  believe  that 
we  do  indeed  stand  on  the  brink  of  epochal  changes. 

Admittedly,  the  usual  impulse  is  to  imagine  everything  around  us 
as  absolutely  new.  Nowhere  is  this  so  true  as  with  money.  How  many 
times  have  we  been  told  that  the  advent  of  virtual  money,  the  dema- 
terialization  of  cash  into  plastic  and  dollars  into  blips  of  electronic 
information,  has  brought  us  to  an  unprecedented  new  financial  world? 
The  assumption  that  we  were  in  such  uncharted  territory,  of  course, 
was  one  of  the  things  that  made  it  so  easy  for  the  likes  of  Goldman 
Sachs  and  AIG  to  convince  people  that  no  one  could  possibly  under- 
stand their  dazzling  new  financial  instruments.  The  moment  one  casts 
matters  on  a  broad  historical  scale,  though,  the  first  thing  one  learns 



is  that  there's  nothing  new  about  virtual  money.  Actually,  this  was  the 
original  form  of  money.  Credit  system,  tabs,  even  expense  accounts,  all 
existed  long  before  cash.  These  things  are  as  old  as  civilization  itself. 
True,  we  also  find  that  history  tends  to  move  back  and  forth  between 
periods  dominated  by  bullion — where  it's  assumed  that  gold  and  silver 
are  money — and  periods  where  money  is  assumed  to  be  an  abstrac- 
tion, a  virtual  unit  of  account.  But  historically,  credit  money  comes 
first,  and  what  we  are  witnessing  today  is  a  return  of  assumptions  that 
would  have  been  considered  obvious  common  sense  in,  say,  the  Middle 
Ages — or  even  ancient  Mesopotamia. 

But  history  does  provide  fascinating  hints  of  what  we  might  expect. 
For  instance:  in  the  past,  ages  of  virtual  credit  money  almost  invari- 
ably involve  the  creation  of  institutions  designed  to  prevent  everything 
going  haywire — to  stop  the  lenders  from  teaming  up  with  bureaucrats 
and  politicians  to  squeeze  everybody  dry,  as  they  seem  to  be  doing 
now.  They  are  accompanied  by  the  creation  of  institutions  designed  to 
protect  debtors.  The  new  age  of  credit  money  we  are  in  seems  to  have 
started  precisely  backwards.  It  began  with  the  creation  of  global  insti- 
tutions like  the  IMF  designed  to  protect  not  debtors,  but  creditors.  At 
the  same  time,  on  the  kind  of  historical  scale  we're  talking  about  here, 
a  decade  or  two  is  nothing.  We  have  very  little  idea  what  to  expect.' 

This  book  is  a  history  of  debt,  then,  but  it  also  uses  that  history  as 
a  way  to  ask  fundamental  questions  about  what  human  beings  and 
human  society  are  or  could  be  like — what  we  actually  do  owe  each 
other,  what  it  even  means  to  ask  that  question.  As  a  result,  the  book 
begins  by  attempting  to  puncture  a  series  of  myths — not  only  the  Myth 
of  Barter,  which  is  taken  up  in  the  first  chapter,  but  also  rival  myths 
about  primordial  debts  to  the  gods,  or  to  the  state — that  in  one  way  or 
another  form  the  basis  of  our  common-sense  assumptions  about  the  na- 
ture of  economy  and  society.  In  that  common-sense  view,  the  State  and 
the  Market  tower  above  all  else  as  diametrically  opposed  principles. 
Historical  reality  reveals,  however,  that  they  were  born  together  and 
have  always  been  intertwined.  The  one  thing  that  all  these  misconcep- 
tions have  in  common,  we  will  find,  is  that  they  tend  to  reduce  all  hu- 
man relations  to  exchange,  as  if  our  ties  to  society,  even  to  the  cosmos 
itself,  can  be  imagined  in  the  same  terms  as  a  business  deal.  This  leads 
to  another  question:  If  not  exchange,  then  what?  In  chapter  five,  I  will 
begin  to  answer  the  question  by  drawing  on  the  fruits  of  anthropol- 
ogy to  describe  a  view  of  the  moral  basis  of  economic  life;  then  return 



to  the  question  of  the  origins  of  money  to  demonstrate  how  the  very 
principle  of  exchange  emerged  largely  as  an  effect  of  violence — that  the 
real  origins  of  money  are  to  be  found  in  crime  and  recompense,  war 
and  slavery,  honor,  debt,  and  redemption.  That,  in  turn,  opens  the  way 
to  starting,  with  chapter  eight,  an  actual  history  of  the  last  five  thou- 
sand years  of  debt  and  credit,  with  its  great  alternations  between  ages 
of  virtual  and  physical  money.  Many  of  the  discoveries  here  are  pro- 
foundly unexpected:  from  the  origins  of  modern  conceptions  of  rights 
and  freedoms  in  ancient  slave  law,  to  the  origins  of  investment  capital 
in  medieval  Chinese  Buddhism,  to  the  fact  that  many  of  Adam  Smith's 
most  famous  arguments  appear  to  have  been  cribbed  from  the  works 
of  free-market  theorists  from  medieval  Persia  (a  story  which,  inciden- 
tally, has  interesting  implications  for  understanding  the  current  appeal 
of  political  Islam).  All  of  this  sets  the  stage  for  a  fresh  approach  to  the 
last  five  hundred  years,  dominated  by  capitalist  empires,  and  allows  us 
to  at  least  begin  asking  what  might  really  be  at  stake  in  the  present  day. 

For  a  very  long  time,  the  intellectual  consensus  has  been  that  we 
can  no  longer  ask  Great  Questions.  Increasingly,  it's  looking  like  we 
have  no  other  choice. 

Chapter  Two 


For  every  subtle  and  complicated 
question,  there  is  a  perfectly  simple 
and  straightforward  answer,  which  is 

— H.L.  Mencken 

WHAT  IS  THE  DIFFERENCE  between  a  mere  obligation,  a  sense  that 
one  ought  to  behave  in  a  certain  way,  or  even  that  one  owes  something 
to  someone,  and  a  debt,  properly  speaking?  The  answer  is  simple: 
money.  The  difference  between  a  debt  and  an  obligation  is  that  a  debt 
can  be  precisely  quantified.  This  requires  money. 

Not  only  is  it  money  that  makes  debt  possible:  money  and  debt  ap- 
pear on  the  scene  at  exactly  the  same  time.  Some  of  the  very  first  writ- 
ten documents  that  have  come  down  to  us  are  Mesopotamian  tablets 
recording  credits  and  debits,  rations  issued  by  temples,  money  owed 
for  rent  of  temple  lands,  the  value  of  each  precisely  specified  in  grain 
and  silver.  Some  of  the  earliest  works  of  moral  philosophy,  in  turn,  are 
reflections  on  what  it  means  to  imagine  morality  as  debt — that  is,  in 
terms  of  money. 

A  history  of  debt,  then,  is  thus  necessarily  a  history  of  money — and 
the  easiest  way  to  understand  the  role  that  debt  has  played  in  human 
society  is  simply  to  follow  the  forms  that  money  has  taken,  and  the 
way  money  has  been  used,  across  the  centuries — and  the  arguments 
that  inevitably  ensued  about  what  all  this  means.  Still,  this  is  neces- 
sarily a  very  different  history  of  money  than  we  are  used  to.  When 
economists  speak  of  the  origins  of  money,  for  example,  debt  is  always 
something  of  an  afterthought.  First  comes  barter,  then  money;  credit 
only  develops  later.  Even  if  one  consults  books  on  the  history  of  money 
in,  say,  France,  India,  or  China,  what  one  generally  gets  is  a  history 
of  coinage,  with  barely  any  discussion  of  credit  arrangements  at  all. 
For  almost  a  century,  anthropologists  like  me  have  been  pointing  out 



that  there  is  something  very  wrong  with  this  picture.  The  standard 
economic-history  version  has  little  to  do  with  anything  we  observe 
when  we  examine  how  economic  life  is  actually  conducted,  in  real 
communities  and  marketplaces,  almost  anywhere — where  one  is  much 
more  likely  to  discover  everyone  in  debt  to  everyone  else  in  a  dozen 
different  ways,  and  that  most  transactions  take  place  without  the  use 
of  currency. 

Why  the  discrepancy? 

Some  of  it  is  just  the  nature  of  the  evidence:  coins  are  preserved  in 
the  archeological  record;  credit  arrangements  usually  are  not.  Still,  the 
problem  runs  deeper.  The  existence  of  credit  and  debt  has  always  been 
something  of  a  scandal  for  economists,  since  it's  almost  impossible  to 
pretend  that  those  lending  and  borrowing  money  are  acting  on  purely 
"economic"  motivations  (for  instance,  that  a  loan  to  a  stranger  is  the 
same  as  a  loan  to  one's  cousin);  it  seems  important,  therefore,  to  begin 
the  story  of  money  in  an  imaginary  world  from  which  credit  and  debt 
have  been  entirely  erased.  Before  we  can  apply  the  tools  of  anthropol- 
ogy to  reconstruct  the  real  history  of  money,  we  need  to  understand 
what's  wrong  with  the  conventional  account. 

Economists  generally  speak  of  three  functions  of  money:  medium 
of  exchange,  unit  of  account,  and  store  of  value.  All  economic  text- 
books treat  the  first  as  primary.  Here's  a  fairly  typical  extract  from 
Economics,  by  Case,  Fair,  Gartner,  and  Heather  (1996): 

Money  is  vital  to  the  working  of  a  market  economy.  Imagine 
what  life  would  be  like  without  it.  The  alternative  to  a  mon- 
etary economy  is  barter,  people  exchanging  goods  and  services 
for  other  goods  and  services  directly  instead  of  exchanging  via 
the  medium  of  money. 

How  does  a  barter  system  work?  Suppose  you  want  crois- 
sants, eggs  and  orange  juice  for  breakfast.  Instead  of  going  to 
the  grocer's  and  buying  these  things  with  money,  you  would 
have  to  find  someone  who  has  these  items  and  is  willing  to 
trade  them.  You  would  also  have  to  have  something  the  baker, 
the  orange  juice  purveyor  and  the  egg  vendor  want.  Having 
pencils  to  trade  will  do  you  no  good  if  the  baker  and  the  or- 
ange juice  and  egg  sellers  do  not  want  pencils. 

A  barter  system  requires  a  double  coincidence  of  wants  for 
trade  to  take  place.  That  is,  to  effect  a  trade,  I  need  not  only 
have  to  find  someone  who  has  what  I  want,  but  that  person 
must  also  want  what  I  have.  Where  the  range  of  traded  goods 
is  small,  as  it  is  in  relatively  unsophisticated  economies,  it  is 



not  difficult  to  find  someone  to  trade  with,  and  barter  is  often 

This  latter  point  is  questionable,  but  it's  phrased  in  so  vague  a  way  that 
it  would  be  hard  to  disprove. 

In  a  complex  society  with  many  goods,  barter  exchanges  in- 
volve an  intolerable  amount  of  effort.  Imagine  trying  to  find 
people  who  offer  for  sale  all  the  things  you  buy  in  a  typical  trip 
to  the  grocer's,  and  who  are  willing  to  accept  goods  that  you 
have  to  offer  in  exchange  for  their  goods. 

Some  agreed-upon  medium  of  exchange  (or  means  of  pay- 
ment) neatly  eliminates  the  double  coincidence  of  wants  prob- 

It's  important  to  emphasize  that  this  is  not  presented  as  something 
that  actually  happened,  but  as  a  purely  imaginary  exercise.  "To  see 
that  society  benefits  from  a  medium  of  exchange"  write  Begg,  Fischer 
and  Dornbuch  {Economics,  2005),  "imagine  a  barter  economy."  "Imag- 
ine the  difficulty  you  would  have  today,"  write  Maunder,  Myers,  Wall, 
and  Miller  {Economics  Explained,  1991),  "if  you  had  to  exchange  your 
labor  directly  for  the  fruits  of  someone  else's  labor."  "Imagine,"  write 
Parkin  and  King  {Economics,  1995),  "you  have  roosters,  but  you  want 
roses."3  One  could  multiply  examples  endlessly.  Just  about  every  eco- 
nomics textbook  employed  today  sets  out  the  problem  the  same  way. 
Historically,  they  note,  we  know  that  there  was  a  time  when  there 
was  no  money.  What  must  it  have  been  like?  Well,  let  us  imagine  an 
economy  something  like  today's,  except  with  no  money.  That  would 
have  been  decidedly  inconvenient!  Surely,  people  must  have  invented 
money  for  the  sake  of  efficiency. 

The  story  of  money  for  economists  always  begins  with  a  fantasy 
world  of  barter.  The  problem  is  where  to  locate  this  fantasy  in  time 
and  space:  Are  we  talking  about  cave  men,  Pacific  Islanders,  the  Ameri- 
can frontier?  One  textbook,  by  economists  Joseph  Stiglitz  and  John 
Driffill,  takes  us  to  what  appears  to  be  an  imaginary  New  England  or 
Midwestern  town: 

One  can  imagine  an  old-style  farmer  bartering  with  the  black- 
smith, the  tailor,  the  grocer,  and  the  doctor  in  his  small  town. 
For  simple  barter  to  work,  however,  there  must  be  a  double 
coincidence  of  wants  .  .  .  Henry  has  potatoes  and  wants  shoes, 
Joshua  has  an  extra  pair  of  shoes  and  wants  potatoes.  Bartering 



can  make  them  both  happier.  But  if  Henry  has  firewood  and 
Joshua  does  not  need  any  of  that,  then  bartering  for  Joshua's 
shoes  requires  one  or  both  of  them  to  go  searching  for  more 
people  in  the  hope  of  making  a  multilateral  exchange.  Money 
provides  a  way  to  make  multilateral  exchange  much  simpler. 
Henry  sells  his  firewood  to  someone  else  for  money  and  uses 
the  money  to  buy  Joshua's  shoes.4 

Again  this  is  just  a  make-believe  land  much  like  the  present,  except 
with  money  somehow  plucked  away.  As  a  result  it  makes  no  sense: 
Who  in  their  right  mind  would  set  up  a  grocery  in  such  a  place?  And 
how  would  they  get  supplies?  But  let's  leave  that  aside.  There  is  a 
simple  reason  why  everyone  who  writes  an  economics  textbook  feels 
they  have  to  tell  us  the  same  story.  For  economists,  it  is  in  a  very  real 
sense  the  most  important  story  ever  told.  It  was  by  telling  it,  in  the 
significant  year  of  1776,  that  Adam  Smith,  professor  of  moral  philoso- 
phy at  the  University  of  Glasgow,  effectively  brought  the  discipline  of 
economics  into  being. 

He  did  not  make  up  the  story  entirely  out  of  whole  cloth.  Already 
in  330  bc,  Aristotle  was  speculating  along  vaguely  similar  lines  in  his 
treatise  on  politics.  At  first,  he  suggested,  families  must  have  produced 
everything  they  needed  for  themselves.  Gradually,  some  would  presum- 
ably have  specialized,  some  growing  corn,  others  making  wine,  swap- 
ping one  for  the  other.5  Money,  Aristotle  assumed,  must  have  emerged 
from  such  a  process.  But,  like  the  medieval  schoolmen  who  occasion- 
ally repeated  the  story,  Aristotle  was  never  clear  as  to  how.6 

In  the  years  after  Columbus,  as  Spanish  and  Portuguese  adven- 
turers were  scouring  the  world  for  new  sources  of  gold  and  silver, 
these  vague  stories  disappear.  Certainly  no  one  reported  discovering  a 
land  of  barter.  Most  sixteenth-  and  seventeenth-century  travelers  in  the 
West  Indies  or  Africa  assumed  that  all  societies  would  necessarily  have 
their  own  forms  of  money,  since  all  societies  had  governments  and  all 
governments  issued  money.7 

Adam  Smith,  on  the  other  hand,  was  determined  to  overturn  the 
conventional  wisdom  of  his  day.  Above  all,  he  objected  to  the  notion 
that  money  was  a  creation  of  government.  In  this,  Smith  was  the  intel- 
lectual heir  of  the  Liberal  tradition  of  philosophers  like  John  Locke, 
who  had  argued  that  government  begins  in  the  need  to  protect  private 
property  and  operated  best  when  it  tried  to  limit  itself  to  that  function. 
Smith  expanded  on  the  argument,  insisting  that  property,  money  and 
markets  not  only  existed  before  political  institutions  but  were  the  very 
foundation  of  human  society.  It  followed  that  insofar  as  government 



should  play  any  role  in  monetary  affairs,  it  should  limit  itself  to  guar- 
anteeing the  soundness  of  the  currency.  It  was  only  by  making  such  an 
argument  that  he  could  insist  that  economics  is  itself  a  field  of  human 
inquiry  with  its  own  principles  and  laws — that  is,  as  distinct  from,  say 
ethics  or  politics. 

Smith's  argument  is  worth  laying  out  in  detail  because  it  is,  as  I 
say,  the  great  founding  myth  of  the  discipline  of  economics. 

What,  he  begins,  is  the  basis  of  economic  life,  properly  speaking? 
It  is  "a  certain  propensity  in  human  nature  .  .  .  the  propensity  to  truck, 
barter,  and  exchange  one  thing  for  another."  Animals  don't  do  this. 
"Nobody,"  Smith  observes,  "ever  saw  a  dog  make  a  fair  and  deliberate 
exchange  of  one  bone  for  another  with  another  dog."8  But  humans,  if 
left  to  their  own  devices,  will  inevitably  begin  swapping  and  comparing 
things.  This  is  just  what  humans  do.  Even  logic  and  conversation  are 
really  just  forms  of  trading,  and  as  in  all  things,  humans  will  always 
try  to  seek  their  own  best  advantage,  to  seek  the  greatest  profit  they 
can  from  the  exchange.9 

It  is  this  drive  to  exchange,  in  turn,  which  creates  that  division  of 
labor  responsible  for  all  human  achievement  and  civilization.  Here  the 
scene  shifts  to  another  one  of  those  economists'  faraway  fantasylands — 
it  seems  to  be  an  amalgam  of  North  American  Indians  and  Central 
Asian  pastoral  nomads:10 

In  a  tribe  of  hunters  or  shepherds  a  particular  person  makes 
bows  and  arrows,  for  example,  with  more  readiness  and  dex- 
terity than  any  other.  He  frequently  exchanges  them  for  cattle 
or  for  venison  with  his  companions;  and  he  finds  at  last  that 
he  can  in  this  manner  get  more  cattle  and  venison,  than  if  he 
himself  went  to  the  field  to  catch  them.  From  a  regard  to  his 
own  interest,  therefore,  the  making  of  bows  and  arrows  grows 
to  be  his  chief  business,  and  he  becomes  a  sort  of  armourer. 
Another  excels  in  making  the  frames  and  covers  of  their  little 
huts  or  moveable  houses.  He  is  accustomed  to  be  of  use  in  this 
way  to  his  neighbours,  who  reward  him  in  the  same  manner 
with  cattle  and  with  venison,  till  at  last  he  finds  it  his  interest 
to  dedicate  himself  entirely  to  this  employment,  and  to  become 
a  sort  of  house-carpenter.  In  the  same  manner  a  third  becomes 
a  smith  or  a  brazier;  a  fourth  a  tanner  or  dresser  of  hides  or 
skins,  the  principal-  part  of  the  clothing  of  savages  .  .  . 

It's  only  once  we  have  expert  arrow-makers,  wigwam-makers,  and 
so  on  that  people  start  realizing  there's  a  problem.  Notice  how,  as  in 



so  many  examples,  we  have  a  tendency  to  slip  from  imaginary  savages 
to  small-town  shopkeepers. 

'  But  when  the  division  of  labor  first  began  to  take  place,  this 
power  of  exchanging  must  frequently  have  been  very  much 
clogged  and  embarrassed  in  its  operations.  One  man,  we  shall 
suppose,  has  more  of  a  certain  commodity  than  he  himself  has 
occasion  for,  while  another  has  less.  The  former  consequently 
would  be  glad  to  dispose  of,  and  the  latter  to  purchase,  a  part 
of  this  superfluity.  But  if  this  latter  should  chance  to  have  noth- 
ing that  the  former  stands  in  need  of,  no  exchange  can  be  made 
between  them.  The  butcher  has  more  meat  in  his  shop  than 
he  himself  can  consume,  and  the  brewer  and  the  baker  would 
each  of  them  be  willing  to  purchase  a  part  of  it.  But  they  have 
nothing  to  offer  in  exchange  .  .  . 

In  order  to  avoid  the  inconveniency  of  such  situations,  every 
prudent  man  in  every  period  of  society,  after  the  first  establish- 
ment of  the  division  of  labor,  must  naturally  have  endeavored 
to  manage  his  affairs  in  such  a  manner,  as  to  have  at  all  times 
by  him,  besides  the  peculiar  produce  of  his  own  industry,  a 
certain  quantity  of  some  one  commodity  or  other,  such  as  he 
imagined  that  few  people  would  be  likely  to  refuse  in  exchange 
for  the  produce  of  their  industry." 

So  everyone  will  inevitably  start  stockpiling  something  they  figure 
that  everyone  else  is  likely  to  want.  This  has  a  paradoxical  effect, 
because  at  a  certain  point,  rather  than  making  that  commodity  less 
valuable  (since  everyone  already  has  some)  it  becomes  more  valuable 
(because  it  becomes,  effectively,  currency): 

Salt  is  said  to  be  the  common  instrument  of  commerce  and 
exchanges  in  Abyssinia;  a  species  of  shells  in  some  parts  of 
the  coast  of  India;  dried  cod  at  Newfoundland;  tobacco  in 
Virginia;  sugar  in  some  of  our  West  India  colonies;  hides  or 
dressed  leather  in  some  other  countries;  and  there  is  at  this  day 
a  village  in  Scotland  where  it  is  not  uncommon,  I  am  told,  for 
a  workman  to  carry  nails  instead  of  money  to  the  baker's  shop 
or  the  ale-house.'2 



Eventually,  of  course,  at  least  for  long-distance  trade,  it  all  boils 
down  to  precious  metals,  since  these  are  ideally  suited  to  serve  as  cur- 
rency, being  durable,  portable,  and  able  to  be  endlessly  subdivided  into 
identical  portions. 

Different  metals  have  been  made  use  of  by  different  nations 
for  this  purpose.  Iron  was  the  common  instrument  of  com- 
merce among  the  ancient  Spartans;  copper  among  the  ancient 
Romans;  and  gold  and  silver  among  all  rich  and  commercial 

Those  metals  seem  originally  to  have  been  made  use  of  for  this 
purpose  in  rude  bars,  without  any  stamp  or  coinage  .  .  . 

The  use  of  metals  in  this  rude  state  was  attended  with  two  very 
considerable  inconveniencies;  first  with  the  trouble  of  weigh- 
ing; and,  secondly,  with  that  of  assaying  them.  In  the  precious 
metals,  where  a  small  difference  in  the  quantity  makes  a  great 
difference  in  the  value,  even  the  business  of  weighing,  with 
proper  exactness,  requires  at  least  very  accurate  weights  and 
scales.  The  weighing  of  gold  in  particular  is  an  operation  of 
some  nicety  .  .  .13 

It's  easy  to  see  where  this  is  going.  Using  irregular  metal  ingots  is 
easier  than  barter,  but  wouldn't  standardizing  the  units — say,  stamp- 
ing pieces  of  metal  with  uniform  designations  guaranteeing  weight  and 
fineness,  in  different  denominations — make  things  easier  still?  Clearly  it 
would,  and  so  was  coinage  born.  True,  issuing  coinage  meant  govern- 
ments had  to  get  involved,  since  they  generally  ran  the  mints;  but  in  the 
standard  version  of  the  story,  governments  have  only  this  one  limited 
role — to  guarantee  the  money  supply — and  tend  to  do  it  badly,  since 
throughout  history,  unscrupulous  kings  have  often  cheated  by  debasing 
the  coinage  and  causing  inflation  and  other  sorts  of  political  havoc  in 
what  was  originally  a  matter  of  simple  economic  common  sense. 

Tellingly,  this  story  played  a  crucial  role  not  only  in  founding  the 
discipline  of  economics,  but  in  the  very  idea  that  there  was  something 
called  "the  economy,"  which  operated  by  its  own  rules,  separate  from 
moral  or  political  life,  that  economists  could  take  as  their  field  of  study. 



"The  economy"  is  where  we  indulge  in  our  natural  propensity  to  truck 
and  barter.  We  are  still  trucking  and  bartering.  We  always  will  be. 
Money  is  simply  the  most  efficient  means. 

Economists  like  Karl  Menger  and  Stanley  Jevons  later  improved 
on  the  details  of  the  story,  most  of  all  by  adding  various  mathemati- 
cal equations  to  demonstrate  that  a  random  assortment  of  people  with 
random  desires  could,  in  theory,  produce  not  only  a  single  commodity 
to  use  as  money  but  a  uniform  price  system.  In  the  process,  they  also 
substituted  all  sorts  of  impressive  technical  vocabulary  (i.e.,  "inconve- 
niences" became  "transaction  costs").  The  crucial  thing,  though,  is  that 
by  now,  this  story  has  become  simple  common  sense  for  most  people. 
We  teach  it  to  children  in  schoolbooks  and  museums.  Everybody  knows 
it.  "Once  upon  a  time,  there  was  barter.  It  was  difficult.  So  people  in- 
vented money.  Then  came  the  development  of  banking  and  credit."  It 
all  forms  a  perfectly  simple,  straightforward  progression,  a  process  of 
increasing  sophistication  and  abstraction  that  has  carried  humanity, 
logically  and  inexorably,  from  the  Stone  Age  exchange  of  mastodon 
tusks  to  stock  markets,  hedge  funds,  and  securitized  derivatives.'4 

It  really  has  become  ubiquitous.  Wherever  we  find  money,  we  also 
find  the  story.  At  one  point,  in  the  town  of  Arivonimamo,  in  Madagas- 
car, I  had  the  privilege  of  interviewing  a  Kalanoro,  a  tiny  ghostly  crea- 
ture that  a  local  spirit  medium  claimed  to  keep  hidden  away  in  a  chest 
in  his  home.  The  spirit  belonged  to  the  brother  of  a  notorious  local 
loan  shark,  a  horrible  woman  named  Nordine,  and  to  be  honest  I  was 
a  bit  reluctant  to  have  anything  to  do  with  the  family,  but  some  of  my 
friends  insisted — since  after  all,  this  was  a  creature  from  ancient  times. 
The  creature  spoke  from  behind  a  screen  in  an  eerie,  otherworldly  qua- 
ver. But  all  it  was  really  interested  in  talking  about  was  money.  Finally, 
slightly  exasperated  by  the  whole  charade,  I  asked,  "So,  what  did  you 
use  for  money  back  in  ancient  times,  when  you  were  still  alive?" 

The  mysterious  voice  immediately  replied,  "No.  We  didn't  use 
money.  In  ancient  times  we  used  to  barter  commodities  directly,  one 
for  the  other  ..." 

The  story,  then,  is  everywhere.  It  is  the  founding  myth  of  our  system  of 
economic  relations.  It  is  so  deeply  established  in  common  sense,  even 
in  places  like  Madagascar,  that  most  people  on  earth  couldn't  imagine 
any  other  way  that  money  possibly  could  have  come  about. 

The  problem  is  there's  no  evidence  that  it  ever  happened,  and  an 
enormous  amount  of  evidence  suggesting  that  it  did  not. 



For  centuries  now,  explorers  have  been  trying  to  find  this  fabled 
land  of  barter — none  with  success.  Adam  Smith  set  his  story  in  aborigi- 
nal North  America  (others  preferred  Africa  or  the  Pacific).  In  Smith's 
time,  at  least  it  could  be  said  that  reliable  information  on  Native  Amer- 
ican economic  systems  was  unavailable  in  Scottish  libraries.  But  by 
mid-century,  Lewis  Henry  Morgan's  descriptions  of  the  Six  Nations 
of  the  Iroquois,  among  others,  were  widely  published — and  they  made 
clear  that  the  main  economic  institution  among  the  Iroquois  nations 
were  longhouses  where  most  goods  were  stockpiled  and  then  allocated 
by  women's  councils,  and  no  one  ever  traded  arrowheads  for  slabs  of 
meat.  Economists  simply  ignored  this  information.15  Stanley  Jevons, 
for  example,  who  in  1871  wrote  what  has  come  to  be  considered  the 
classic  book  on  the  origins  of  money,  took  his  examples  straight  from 
Smith,  with  Indians  swapping  venison  for  elk  and  beaver  hides,  and 
made  no  use  of  actual  descriptions  of  Indian  life  that  made  it  clear  that 
Smith  had  simply  made  this  up.  Around  that  same  time,  missionaries, 
adventurers,  and  colonial  administrators  were  fanning  out  across  the 
world,  many  bringing  copies  of  Smith's  book  with  them,  expecting  to 
find  the  land  of  barter.  None  ever  did.  They  discovered  an  almost  end- 
less variety  of  economic  systems.  But  to  this  day,  no  one  has  been  able 
to  locate  a  part  of  the  world  where  the  ordinary  mode  of  economic 
transaction  between  neighbors  takes  the  form  of  "I'll  give  you  twenty 
chickens  for  that  cow." 

The  definitive  anthropological  work  on  barter,  by  Caroline  Hum- 
phrey, of  Cambridge,  could  not  be  more  definitive  in  its  conclusions: 
"No  example  of  a  barter  economy,  pure  and  simple,  has  ever  been 
described,  let  alone  the  emergence  from  it  of  money;  all  available  eth- 
nography suggests  that  there  never  has  been  such  a  thing."1* 

Now,  all  this  hardly  means  that  barter  does  not  exist — or  even 
that  it's  never  practiced  by  the  sort  of  people  that  Smith  would  refer  to 
as  "savages."  It  just  means  that  it's  almost  never  employed,  as  Smith 
imagined,  between  fellow  villagers.  Ordinarily,  it  takes  place  between 
strangers,  even  enemies.  Let  us  begin  with  the  Nambikwara  of  Brazil. 
They  would  seem  to  fit  all  the  criteria:  they  are  a  simple  society  with- 
out much  in  the  way  of  division  of  labor,  organized  into  small  bands 
that  traditionally  numbered  at  best  a  hundred  people  each.  Occasion- 
ally if  one  band  spots  the  cooking  fires  of  another  in  their  vicinity,  they 
will  send  emissaries  to  negotiate  a  meeting  for  purposes  of  trade.  If  the 
offer  is  accepted,  they  will  first  hide  their  women  and  children  in  the 
forest,  then  invite  the  men  of  other  band  to  visit  camp.  Each  band  has 
a  chief;  once  everyone  has  been  assembled,  each  chief  gives  a  formal 
speech  praising  the  other  party  and  belittling  his  own;  everyone  puts 



aside  their  weapons  to  sing  and  dance  together — though  the  dance  is 
one  that  mimics  military  confrontation.  Then,  individuals  from  each 
side  approach  each  other  to  trade: 

If  an  individual  wants  an  object  he  extols  it  by  saying  how  fine 
it  is.  If  a  man  values  an  object  and  wants  much  in  exchange  for 
it,  instead  of  saying  that  it  is  very  valuable  he  says  that  it  is  no 
good,  thus  showing  his  desire  to  keep  it.  "This  axe  is  no  good, 
it  is  very  old,  it  is  very  dull,"  he  will  say,  referring  to  his  axe 
which  the  other  wants. 

This  argument  is  carried  on  in  an  angry  tone  of  voice  un- 
til a  settlement  is  reached.  When  agreement  has  been  reached 
each  snatches  the  object  out  of  the  other's  hand.  If  a  man  has 
bartered  a  necklace,  instead  of  taking  it  off  and  handing  it 
over,  the  other  person  must  take  it  off  with  a  show  of  force. 
Disputes,  often  leading  to  fights,  occur  when  one  party  is  a 
little  premature  and  snatches  the  object  before  the  other  has 
finished  arguing.17 

The  whole  business  concludes  with  a  great  feast  at  which  the  wom- 
en reappear,  but  this  too  can  lead  to  problems,  since  amidst  the  music 
and  good  cheer,  there  is  ample  opportunity  for  seductions.18  This  some- 
times led  to  jealous  quarrels.  Occasionally,  people  would  get  killed. 

Barter,  then,  for  all  the  festive  elements,  was  carried  out  be- 
tween people  who  might  otherwise  be  enemies  and  hovered  about  an 
inch  away  from  outright  warfare — and,  if  the  ethnographer  is  to  be 
believed — if  one  side  later  decided  they  had  been  taken  advantage  of,  it 
could  very  easily  lead  to  actual  wars. 

To  shift  our  spotlight  halfway  around  the  world  to  Western  Arn- 
hem  Land  in  Australia,  where  the  Gunwinggu  people  are  famous  for 
entertaining  neighbors  in  rituals  of  ceremonial  barter  called  the  dza- 
malag.  Here  the  threat  of  actual  violence  seems  much  more  distant. 
Partly,  this  is  because  things  are  made  easier  by  the  existence  of  a  moi- 
ety system  that  embraces  the  whole  region:  no  one  is  allowed  to  marry, 
or  even  have  sex  with,  people  of  their  own  moiety,  no  matter  where 
they  come  from,  but  anyone  from  the  other  is  technically  a  potential 
match.  Therefore,  for  a  man,  even  in  distant  communities,  half  the 
women  are  strictly  forbidden,  half  of  them  fair  game.  The  region  is  also 
united  by  local  specialization:  each  people  has  its  own  trade  product  to 
be  bartered  with  the  others. 

What  follows  is  from  a  description  of  a  dzamalag  held  in  the  1940s, 
as  observed  by  an  anthropologist  named  Ronald  Berndt. 



Once  again,  it  begins  as  strangers,  after  some  initial  negotiations, 
are  invited  into  the  hosts'  main  camp.  The  visitors  in  this  particular 
example  were  famous  for  their  "much-prized  serrated  spears" — their 
hosts  had  access  to  good  European  cloth.  The  trading  begins  when 
the  visiting  party,  which  consisted  of  both  men  and  women,  enters 
the  camp's  dancing  ground  of  "ring  place,"  and  three  of  them  began 
to  entertain  their  hosts  with  music.  Two  men  start  singing,  a  third  ac- 
companies them  on  the  didjeridu.  Before  long,  women  from  the  hosts' 
side  come  and  attack  the  musicians: 

Men  and  women  rise  and  begin  to  dance.  The  dzamalag  opens 
when  two  Gunwinggu  women  of  the  opposite  moiety  to  the 
singing  men  "give  dzamalag"  to  the  latter.  They  present  each 
man  with  a  piece  of  cloth,  and  hit  or  touch  him,  pulling  him 
down  on  the  ground,  calling  him  a  dzamalag  husband,  and 
joking  with  him  in  an  erotic  vein.  Then  another  woman  of  the 
opposite  moiety  to  the  pipe  player  gives  him  cloth,  hits  and 
jokes  with  him. 

This  sets  in  motion  the  dzamalag  exchange.  Men  from  the 
visiting  group  sit  quietly  while  women  of  the  opposite  moiety 
come  over  and  give  them  cloth,  hit  them,  and  invite  them  to 
copulate;  they  take  any  liberty  they  choose  with  the  men,  amid 
amusement  and  applause,  while  the  singing  and  dancing  con- 
tinue. Women  try  to  undo  the  men's  loin  coverings  or  touch 
their  penises,  and  to  drag  them  from  the  "ring  place"  for  co- 
itus. The  men  go  with  their  dzamalag  partners,  with  a  show  of 
reluctance,  to  copulate  in  the  bushes  away  from  the  fires  which 
light  up  the  dancers.  They  may  give  the  women  tobacco  or 
beads.  When  the  women  return,  they  give  part  of  this  tobacco 
to  their  own  husbands,  who  have  encouraged  them  to  go  dza- 
malag. The  husbands,  in  turn,  use  the  tobacco  to  pay  their  own 
female  dzamalag  partners  .  . 

New  singers  and  musicians  appear,  are  again  assaulted  and  dragged 
off  to  the  bushes;  men  encourage  their  wives  "not  to  be  shy,"  so  as  to 
maintain  the  Gunwinggu  reputation  for  hospitality;  eventually  those 
men  also  take  the  initiative  with  the  visitors'  wives,  offering  cloth,  hit- 
ting them,  and  leading  them  off  into  the  bushes.  Beads  and  tobacco 
circulate.  Finally,  once  participants  have  all  paired  off  at  least  once, 
and  the  guests  are  satisfied  with  the  cloth  they  have  acquired,  the 
women  stop  dancing  and  stand  in  two  rows  and  the  visitors  line  up  to 
repay  them. 



Then  visiting  men  of  one  moiety  dance  towards  the  women 
of  the  opposite  moiety,  in  order  to  "give  them  dzamalag." 
They  hold  shovel-nosed  spears  poised,  pretending  to  spear  the 
women,  but  instead  hit  them  with  the  flat  of  the  blade.  "We 
will  not  spear  you,  for  we  have  already  speared  you  with  our 
penises."  They  present  the  spears  to  the  women.  Then  visiting 
men  of  the  other  moiety  go  through  the  same  actions  with  the 
women  of  their  opposite  moiety,  giving  them  spears  with  ser- 
rated points.  This  terminates  the  ceremony,  which  is  followed 
by  a  large  distribution  of  food.20 

This  is  a  particularly  dramatic  case,  but  dramatic  cases  are  reveal- 
ing. What  the  Gunwinggu  hosts  appear  to  have  been  able  to  do  here, 
owing  to  the  relatively  amicable  relations  between  neighboring  peoples 
in  Western  Arnhem  Land,  is  to  take  all  the  elements  in  Nambikwara 
barter  (the  music  and  dancing,  the  potential  hostility,  the  sexual  in- 
trigue), and  turn  it  all  into  a  kind  of  festive  game — one  not,  perhaps, 
without  its  dangers,  but  (as  the  ethnographer  emphasizes)  considered 
enormous  fun  by  everyone  concerned. 

What  all  such  cases  of  trade  through  barter  have  in  common  is  that 
they  are  meetings  with  strangers  who  will,  likely  as  not,  never  meet 
again,  and  with  whom  one  certainly  will  not  enter  into  any  ongoing  re- 
lations. This  is  why  a  direct  one-on-one  exchange  is  appropriate:  each 
side  makes  their  trade  and  walks  away.  It's  all  made  possible  by  laying 
down  an  initial  mantle  of  sociability,  in  the  form  of  shared  pleasures, 
music  and  dance — the  usual  base  of  conviviality  on  which  trade  must 
always  be  built.  Then  comes  the  actual  trading,  where  both  sides  make 
a  great  display  of  the  latent  hostility  that  necessarily  exists  in  any  ex- 
change of  material  goods  between  strangers — where  neither  party  has 
no  particular  reason  not  to  take  advantage  of  the  other — by  playful 
mock  aggression,  though  in  the  Nambikwara  case,  where  the  mantle 
of  sociability  is  extremely  thin,  mock  aggression  is  in  constant  danger 
of  slipping  over  into  the  real  thing.  The  Gunwinggu,  with  their  more 
relaxed  attitude  toward  sexuality,  have  quite  ingeniously  managed  to 
make  the  shared  pleasures  and  aggression  into  exactly  the  same  thing. 

Recall  here  the  language  of  the  economics  textbooks:  "Imagine  a 
society  without  money."  "Imagine  a  barter  economy."  One  thing  these 
examples  make  abundantly  clear  is  just  how  limited  the  imaginative 
powers  of  most  economists  turn  out  to  be.21 

Why?  The  simplest  answer  would  be:  for  there  to  even  be  a  disci- 
pline called  "economics,"  a  discipline  that  concerns  itself  first  and  fore- 
most with  how  individuals  seek  the  most  advantageous  arrangement 



for  the  exchange  of  shoes  for  potatoes,  or  cloth  for  spears,  it  must 
assume  that  the  exchange  of  such  goods  need  have  nothing  to  do  with 
war,  passion,  adventure,  mystery,  sex,  or  death.  Economics  assumes  a 
division  between  different  spheres  of  human  behavior  that,  among  peo- 
ple like  the  Gunwinngu  and  the  Nambikwara,  simply  does  not  exist. 
These  divisions  in  turn  are  made  possible  by  very  specific  institutional 
arrangements:  the  existence  of  lawyers,  prisons,  and  police,  to  ensure 
that  even  people  who  don't  like  each  other  very  much,  who  have  no 
interest  in  developing  any  kind  of  ongoing  relationship,  but  are  simply 
interested  in  getting  their  hands  on  as  much  of  the  others'  possessions 
as  possible,  will  nonetheless  refrain  from  the  most  obvious  expedient 
(theft).  This  in  turn  allows  us  to  assume  that  life  is  neatly  divided  be- 
tween the  marketplace,  where  we  do  our  shopping,  and  the  "sphere 
of  consumption,"  where  we  concern  ourselves  with  music,  feasts,  and 
seduction.  In  other  words,  the  vision  of  the  world  that  forms  the  basis 
of  the  economics  textbooks,  which  Adam  Smith  played  so  large  a  part 
in  promulgating,  has  by  now  become  so  much  a  part  of  our  common 
sense  that  we  find  it  hard  to  imagine  any  other  possible  arrangement. 

From  these  examples,  it  begins  to  be  clear  why  there  are  no  societ- 
ies based  on  barter.  Such  a  society  could  only  be  one  in  which  every- 
body was  an  inch  away  from  everybody  else's  throat;  but  nonetheless 
hovering  there,  poised  to  strike  but  never  actually  striking,  forever. 
True,  barter  does  sometimes  occur  between  people  who  do  not  consid- 
er each  other  strangers,  but  they're  usually  people  who  might  as  well  be 
strangers — that  is,  who  feel  no  sense  of  mutual  responsibility  or  trust, 
or  the  desire  to  develop  ongoing  relations.  The  Pukhtun  of  Northern 
Pakistan,  for  instance,  are  famous  for  their  open-handed  hospitality. 
Barter  is  what  you  do  with  those  to  whom  you  are  not  bound  by  ties 
of  hospitality  (or  kinship,  or  much  of  anything  else): 

A  favorite  mode  of  exchange  among  men  is  barter,  or  adal- 
badal  (give  and  take).  Men  are  always  on  the  alert  for  the 
possibility  of  bartering  one  of  their  possessions  for  something 
better.  Often  the  exchange  is  like  for  like:  a  radio  for  a  radio, 
sunglasses  for  sunglasses,  a  watch  for  a  watch.  However,  un- 
like objects  can  also  be  exchanged,  such  as,  in  one  instance,  a 
bicycle  for  two  donkeys.  Adal-badal  is  always  practiced  with 
non-relatives  and  affords  men  a  great  deal  of  pleasure  as  they 
attempt  to  get  the  advantage  over  their  exchange  partner.  A 
good  exchange,  in  which  a  man  feels  he  has  gotten  the  better 
of  the  deal,  is  cause  for  bragging  and  pride.  If  the  exchange  is 
bad,  the  recipient  tries  to  renege  on  the  deal  or,  failing  that,  to 



palm  off  the  faulty  object  on  someone  unsuspecting.  The  best 
partner  in  adal-badal  is  someone  who  is  distant  spatially  and 
will  therefore  have  little  opportunity  to  complain.22 

Neither  are  such  unscrupulous  motives  limited  to  Central  Asia. 
They  seem  inherent  to  the  very  nature  of  barter — which  would  explain 
the  fact  that  in  the  century  or  two  before  Smith's  time,  the  English 
words  "truck  and  barter,"  like  their  equivalents  in  French,  Spanish, 
German,  Dutch,  and  Portuguese,  literally  meant  "to  trick,  bamboozle, 
or  rip  off."23  Swapping  one  thing  directly  for  another  while  trying  to 
get  the  best  deal  one  can  out  of  the  transaction  is,  ordinarily,  how 
one  deals  with  people  one  doesn't  care  about  and  doesn't  expect  to 
see  again.  What  reason  is  there  not  to  try  to  take  advantage  of  such 
a  person?  If,  on  the  other  hand,  one  cares  enough  about  someone — a 
neighbor,  a  friend — to  wish  to  deal  with  her  fairly  and  honestly,  one 
will  inevitably  also  care  about  her  enough  to  take  her  individual  needs, 
desires,  and  situation  into  account.  Even  if  you  do  swap  one  thing  for 
another,  you  are  likely  to  frame  the  matter  as  a  gift. 

To  illustrate  what  I  mean  by  this,  let's  return  to  the  economics  text- 
books and  the  problem  of  the  "double  coincidence  of  wants."  When 
we  left  Henry,  he  needed  a  pair  of  shoes,  but  all  he  had  lying  around 
were  some  potatoes.  Joshua  had  an  extra  pair  of  shoes,  but  he  didn't 
really  need  potatoes.  Since  money  has  not  yet  been  invented,  they  have 
a  problem.  What  are  they  to  do? 

The  first  thing  that  should  be  clear  by  now  is  that  we'd  really  have 
to  know  a  bit  more  about  Joshua  and  Henry.  Who  are  they?  Are  they 
related?  If  so,  how?  They  appear  to  live  in  a  small  community.  Any  two 
people  who  have  been  living  their  lives  in  the  same  small  community 
will  have  some  sort  of  complicated  history  with  each  other.  Are  they 
friends,  rivals,  allies,  lovers,  enemies,  or  several  of  these  things  at  once? 

The  authors  of  the  original  example  seem  to  assume  two  neighbors 
of  roughly  equal  status,  not  closely  related,  but  on  friendly  terms — that 
is,  as  close  to  neutral  equality  as  one  can  get.  Even  so,  this  doesn't  say 
much.  For  example,  if  Henry  was  living  in  a  Seneca  longhouse,  and 
needed  shoes,  Joshua  would  not  even  enter  into  it;  he'd  simply  men- 
tion it  to  his  wife,  who'd  bring  up  the  matter  with  the  other  matrons, 
fetch  materials  from  the  longhouse's  collective  storehouse,  and  sew  him 
some.  Alternately,  to  find  a  scenario  fit  for  an  imaginary  economics 



textbook,  we  might  place  Joshua  and  Henry  together  in  a  small,  inti- 
mate community  like  a  Nambikwara  or  Gunwinggu  band. 


Henry  walks  up  to  Joshua  and  says  "Nice  shoes!" 

Joshua  says,  "Oh,  they're  not  much,  but  since  you  seem  to  like 
them,  by  all  means  take  them." 

Henry  takes  the  shoes. 

Henry's  potatoes  are  not  at  issue  since  both  parties  are  perfectly 
well  aware  that  if  Joshua  were  ever  short  of  potatoes,  Henry  would 
give  him  some. 

And  that's  about  it.  Of  course  it's  not  clear,  in  this  case,  how  long 
Henry  will  actually  get  to  keep  the  shoes.  It  probably  depends  on  how 
nice  they  are.  If  they  were  just  ordinary  shoes,  this  might  be  the  end  of 
the  matter.  If  they  are  in  any  way  unique  or  beautiful,  they  might  end 
up  being  passed  around.  There's  a  famous  story  that  John  and  Lorna 
Marshall,  who  carried  out  a  study  of  Kalahari  Bushmen  in  the  '60s, 
once  gave  a  knife  to  one  of  their  favorite  informants.  They  left  and 
came  back  a  year  later,  only  to  discover  that  pretty  much  everyone  in 
the  band  had  been  in  possession  of  the  knife  at  some  point  in  between. 
On  the  other  hand,  several  Arab  friends  confirm  to  me  that  in  less 
strictly  egalitarian  contexts,  there  is  an  expedient.  If  a  friend  praises  a 
bracelet  or  bag,  you  are  normally  expected  to  immediately  say  "take 
it" — but  if  you  are  really  determined  to  hold  on  to  it,  you  can  always 
say,  "yes,  isn't  it  beautiful?  It  was  a  gift." 

But  clearly,  the  authors  of  the  textbook  have  a  slightly  more  im- 
personal transaction  in  mind.  The  authors  seem  to  imagine  the  two 
men  as  the  heads  of  patriarchal  households,  on  good  terms  with  each 
other,  but  who  keep  their  own  supplies.  Perhaps  they  live  in  one  of 
those  Scottish  villages  with  the  butcher  and  the  baker  in  Adam  Smith's 
examples,  or  a  colonial  settlement  in  New  England.  Except  for  some 
reason  they've  never  heard  of  money.  It's  a  peculiar  fantasy,  but  let's 
see  what  we  can  do: 


Henry  walks  up  to  Joshua  and  says,  "Nice  shoes!" 

Or,  perhaps — let's  make  this  a  bit  more  realistic — Henry's  wife 
is  chatting  with  Joshua's  and  strategically  lets  slip  that  the  state  of 
Henry's  shoes  is  getting  so  bad  he's  complaining  about  corns. 



The  message  is  conveyed,  and  Joshua  comes  by  the  next  day  to 
offer  his  extra  pair  to  Henry  as  a  present,  insisting  that  this  is  just 
a  neighborly  gesture.  He  would  certainly  never  want  anything  in 

It  doesn't  matter  whether  Joshua  is  sincere  in  saying  this.  By  do- 
ing so,  Joshua  thereby  registers  a  credit.  Henry  owes  him  one. 

How  might  Henry  pay  Joshua  back?  There  are  endless  possi- 
bilities. Perhaps  Joshua  really  does  want  potatoes.  Henry  waits  a 
discrete  interval  and  drops  them  off,  insisting  that  this  too  is  just  a 
gift.  Or  Joshua  doesn't  need  potatoes  now  but  Henry  waits  until  he 
does.  Or  maybe  a  year  later,  Joshua  is  planning  a  banquet,  so  he 
comes  strolling  by  Henry's  barnyard  and  says  "Nice  pig  .  .  ." 

In  any  of  these  scenarios,  the  problem  of  "double  coincidence  of 
wants,"  so  endlessly  invoked  in  the  economics  textbooks,  simply  disap- 
pears. Henry  might  not  have  something  Joshua  wants  right  now.  But 
if  the  two  are  neighbors,  it's  obviously  only  a  matter  of  time  before 
he  will.24 

This  in  turn  means  that  the  need  to  stockpile  commonly  acceptable 
items  in  the  way  that  Smith  suggested  disappears  as  well.  With  it  goes 
the  need  to  develop  currency.  As  with  so  many  actual  small  communi- 
ties, everyone  simply  keeps  track  of  who  owes  what  to  whom. 

There  is  just  one  major  conceptual  problem  here — one  the  atten- 
tive reader  might  have  noticed.  Henry  "owes  Joshua  one."  One  what? 
How  do  you  quantify  a  favor?  On  what  basis  do  you  say  that  this 
many  potatoes,  or  this  big  a  pig,  seems  more  or  less  equivalent  to  a 
pair  of  shoes?  Because  even  if  these  things  remain  rough-and-ready  ap- 
proximations, there  must  be  some  way  to  establish  that  X  is  roughly 
equivalent  to  Y,  or  slightly  worse  or  slightly  better.  Doesn't  this  imply 
that  something  like  money,  at  least  in  the  sense  of  a  unit  of  accounts 
by  which  one  can  compare  the  value  of  different  objects,  already  has 
to  exist? 

In  most  gift  economies,  there  actually  is  a  rough-and-ready  way 
to  solve  the  problem.  One  establishes  a  series  of  ranked  categories  of 
types  of  thing.  Pigs  and  shoes  may  be  considered  objects  of  roughly 
equivalent  status,  one  can  give  one  in  return  for  the  other;  coral  neck- 
laces are  quite  another  matter,  one  would  have  to  give  back  another 
necklace,  or  at  least  another  piece  of  jewelry — anthropologists  are  used 
to  referring  to  these  as  creating  different  "spheres  of  exchange."25  This 
does  simplify  things  somewhat.  When  cross-cultural  barter  becomes  a 
regular  and  unexceptional  thing,  it  tends  to  operate  according  to  simi- 
lar principles:  there  are  only  certain  things  traded  for  certain  others 



(cloth  for  spears,  for  example),  which  makes  it  easy  to  work  out  tra- 
ditional equivalences.  However,  this  doesn't  help  us  at  all  with  the 
problem  of  the  origin  of  money.  Actually,  it  makes  it  infinitely  worse. 
Why  stockpile  salt  or  gold  or  fish  if  they  can  only  be  exchanged  for 
some  things  and  not  others? 

In  fact,  there  is  good  reason  to  believe  that  barter  is  not  a  par- 
ticularly ancient  phenomenon  at  all,  but  has  only  really  become  wide- 
spread in  modern  times.  Certainly  in  most  of  the  cases  we  know  about, 
it  takes  place  between  people  who  are  familiar  with  the  use  of  money, 
but  for  one  reason  or  another,  don't  have  a  lot  of  it  around.  Elaborate 
barter  systems  often  crop  up  in  the  wake  of  the  collapse  of  national 
economies:  most  recently  in  Russia  in  the  '90s,  and  in  Argentina  around 
2002,  when  rubles  in  the  first  case,  and  dollars  in  the  second,  effectively 
disappeared.26  Occasionally  one  can  even  find  some  kind  of  currency 
beginning  to  develop:  for  instance,  in  POW  camps  and  many  prisons, 
inmates  have  indeed  been  known  to  use  cigarettes  as  a  kind  of  cur- 
rency, much  to  the  delight  and  excitement  of  professional  economists.27 
But  here  too  we  are  talking  about  people  who  grew  up  using  money 
and  now  have  to  make  do  without  it — exactly  the  situation  "imagined" 
by  the  economics  textbooks  with  which  I  began. 

The  more  frequent  solution  is  to  adopt  some  sort  of  credit  system. 
When  much  of  Europe  "reverted  to  barter"  after  the  collapse  of  the 
Roman  Empire,  and  then  again  after  the  Carolingian  Empire  likewise 
fell  apart,  this  seems  to  be  what  happened.  People  continued  keeping 
accounts  in  the  old  imperial  currency,  even  if  they  were  no  longer  us- 
ing coins.28  Similarly,  the  Pukhtun  men  who  like  to  swap  bicycles  for 
donkeys  are  hardly  unfamiliar  with  the  use  of  money.  Money  has  ex- 
isted in  that  part  of  the  world  for  thousands  of  years.  They  just  prefer 
direct  exchange  between  equals — in  this  case,  because  they  consider  it 
more  manly.29 

The  most  remarkable  thing  is  that  even  in  Adam  Smith's  examples 
of  fish  and  nails  and  tobacco  being  used  as  money,  the  same  sort  of 
thing  was  happening.  In  the  years  following  the  appearance  of  The 
Wealth  of  Nations,  scholars  checked  into  most  of  those  examples  and 
discovered  that  in  just  about  every  case,  the  people  involved  were  quite 
familiar  with  the  use  of  money,  and  in  fact,  were  using  money — as  a 
unit  of  account.30  Take  the  example  of  dried  cod,  supposedly  used  as 
money  in  Newfoundland.  As  the  British  diplomat  A.  Mitchell-Innes 
pointed  out  almost  a  century  ago,  what  Smith  describes  was  really  an 
illusion,  created  by  a  simple  credit  arrangement: 



In  the  early  days  of  the  Newfoundland  fishing  industry,  there 
was  no  permanent  European  population;  the  fishers  went  there 
for  the  fishing  season  only,  and  those  who  were  not  fishers 
were  traders  who  bought  the  dried  fish  and  sold  to  the  fishers 
their  daily  supplies.  The  latter  sold  their  catch  to  the  traders  at 
the  market  price  in  pounds,  shillings  and  pence,  and  obtained 
in  return  a  credit  on  their  books,  with  which  they  paid  for  their 
supplies.  Balances  due  by  the  traders  were  paid  for  by  drafts  on 
England  or  France.31 

It  was  quite  the  same  in  the  Scottish  village.  It's  not  as  if  anyone 
actually  walked  into  the  local  pub,  plunked  down  a  roofing  nail,  and 
asked  for  a  pint  of  beer.  Employers  in  Smith's  day  often  lacked  coin 
to  pay  their  workers;  wages  could  be  delayed  by  a  year  or  more;  in 
the  meantime,  it  was  considered  acceptable  for  employees  to  carry  off 
either  some  of  their  own  products  or  leftover  work  materials,  lumber, 
fabric,  cord,  and  so  on.  The  nails  were  de  facto  interest  on  what  their 
employers  owed  them.  So  they  went  to  the  pub,  ran  up  a  tab,  and  when 
occasion  permitted,  brought  in  a  bag  of  nails  to  charge  off  against  the 
debt.  The  law  making  tobacco  legal  tender  in  Virginia  seems  to  have 
been  an  attempt  by  planters  to  oblige  local  merchants  to  accept  their 
products  as  a  credit  around  harvest  time.  In  effect,  the  law  forced  all 
merchants  in  Virginia  to  become  middlemen  in  the  tobacco  business, 
whether  they  liked  it  or  not;  just  as  all  West  Indian  merchants  were 
obliged  to  become  sugar  dealers,  since  that's  what  all  their  wealthier 
customers  brought  in  to  write  off  against  their  debt. 

The  primary  examples,  then,  were  ones  in  which  people  were 
improvising  credit  systems,  because  actual  money — gold  and  silver 
coinage — was  in  short  supply.  But  the  most  shocking  blow  to  the  con- 
ventional version  of  economic  history  came  with  the  translation,  first  of 
Egyptian  hieroglyphics,  and  then  of  Mesopotamian  cuneiform,  which 
pushed  back  scholars'  knowledge  of  written  history  almost  three  mil- 
lennia, from  the  time  of  Homer  (circa  800  bc),  where  it  had  hovered  in 
Smith's  time,  to  roughly  3500  bc.  What  these  texts  revealed  was  that 
credit  systems  of  exactly  this  sort  actually  preceded  the  invention  of 
coinage  by  thousands  of  years. 

The  Mesopotamian  system  is  the  best-documented,  more  so  than 
that  of  Pharaonic  Egypt  (which  appears  similar),  Shang  China  (about 
which  we  know  little),  or  the  Indus  Valley  civilization  (about  which 
we  know  nothing  at  all).  As  it  happens,  we  know  a  great  deal  about 
Mesopotamia,  since  the  vast  majority  of  cuneiform  documents  were 
financial  in  nature. 



The  Sumerian  economy  was  dominated  by  vast  temple  and  palace 
complexes.  These  were  often  staffed  by  thousands:  priests  and  officials, 
craftspeople  who  worked  in  their  industrial  workshops,  farmers  and 
shepherds  who  worked  their  considerable  estates.  Even  though  ancient 
Sumer  was  usually  divided  into  a  large  number  of  independent  city- 
states,  by  the  time  the  curtain  goes  up  on  Mesopotamian  civilization 
around  3500,  temple  administrators  already  appear  to  have  developed 
a  single,  uniform  system  of  accountancy — one  that  is  in  some  ways 
still  with  us,  actually,  because  it's  to  the  Sumerians  that  we  owe  such 
things  as  the  dozen  or  the  24-hour  day.32  The  basic  monetary  unit  was 
the  silver  shekel.  One  shekel's  weight  in  silver  was  established  as  the 
equivalent  of  one  gur,  or  bushel  of  barley.  A  shekel  was  subdivided 
into  60  minas,  corresponding  to  one  portion  of  barley — on  the  prin- 
ciple that  there  were  30  days  in  a  month,  and  Temple  workers  received 
two  rations  of  barley  every  day.  It's  easy  to  see  that  "money"  in  this 
sense  is  in  no  way  the  product  of  commercial  transactions.  It  was  ac- 
tually created  by  bureaucrats  in  order  to  keep  track  of  resources  and 
move  things  back  and  forth  between  departments. 

Temple  bureaucrats  used  the  system  to  calculate  debts  (rents,  fees, 
loans  .  .  .)  in  silver.  Silver  was,  effectively,  money.  And  it  did  indeed 
circulate  in  the  form  of  unworked  chunks,  "rude  bars"  as  Smith  had 
put  it.33  In  this  he  was  right.  But  it  was  almost  the  only  part  of  his  ac- 
count that  was  right.  One  reason  was  that  silver  did  not  circulate  very 
much.  Most  of  it  just  sat  around  in  Temple  and  Palace  treasuries,  some 
of  which  remained,  carefully  guarded,  in  the  same  place  for  literally 
thousands  of  years.  It  would  have  been  easy  enough  to  standardize  the 
ingots,  stamp  them,  create  some  authoritative  system  to  guarantee  their 
purity.  The  technology  existed.  Yet  no  one  saw  any  particular  need  to 
do  so.  One  reason  was  that  while  debts  were  calculated  in  silver,  they 
did  not  have  to  be  paid  in  silver — in  fact,  they  could  be  paid  in  more 
or  less  anything  one  had  around.  Peasants  who  owed  money  to  the 
Temple  or  Palace,  or  to  some  Temple  or  Palace  official,  seem  to  have 
settled  their  debts  mostly  in  barley,  which  is  why  fixing  the  ratio  of  sil- 
ver to  barley  was  so  important.  But  it  was  perfectly  acceptable  to  show 
up  with  goats,  or  furniture,  or  lapis  lazuli.  Temples  and  Palaces  were 
huge  industrial  operations — they  could  find  a  use  for  almost  anything.34 

In  the  marketplaces  that  cropped  up  in  Mesopotamian  cities,  pric- 
es were  also  calculated  in  silver,  and  the  prices  of  commodities  that 
weren't  entirely  controlled  by  the  Temples  and  Palaces  would  tend  to 
fluctuate  according  to  supply  and  demand.  But  even  here,  such  evidence 
as  we  have  suggests  that  most  transactions  were  based  on  credit.  Mer- 
chants (who  sometimes  worked  for  the  Temples,  sometimes  operated 



independently)  were  among  the  few  people  who  did,  often,  actually  use 
silver  in  transactions;  but  even  they  mostly  did  much  of  their  dealings 
on  credit,  and  ordinary  people  buying  beer  from  "ale  women,"  or  lo- 
cal innkeepers,  once  again,  did  so  by  running  up  a  tab,  to  be  settled  at 
harvest  time  in  barley  or  anything  they  might  have  had  at  hand.35 

At  this  point,  just  about  every  aspect  of  the  conventional  story  of 
the  origins  of  money  lay  in  rubble.  Rarely  has  an  historical  theory  been 
so  absolutely  and  systematically  refuted.  By  the  early  decades  of  the 
twentieth  century,  all  the  pieces  were  in  place  to  completely  rewrite 
the  history  of  money.  The  groundwork  was  laid  by  Mitchell-Innes — 
the  same  one  I've  already  cited  on  the  matter  of  the  cod — in  two  essays 
that  appeared  in  New  York's  Banking  Law  Journal  in  1913  and  1914. 
In  these,  Mitchell-Innes  matter-of-factly  laid  out  the  false  assumptions 
on  which  existing  economic  history  was  based  and  suggested  that  what 
was  really  needed  was  a  history  of  debt: 

One  of  the  popular  fallacies  in  connection  with  commerce  is 
that  in  modern  days  a  money-saving  device  has  been  intro- 
duced called  credit  and  that,  before  this  device  was  known, 
all,  purchases  were  paid  for  in  cash,  in  other  words  in  coins.  A 
careful  investigation  shows  that  the  precise  reverse  is  true.  In 
olden  days  coins  played  a  far  smaller  part  in  commerce  than 
they  do  to-day.  Indeed  so  small  was  the  quantity  of  coins,  that 
they  did  not  even  suffice  for  the  needs  of  the  [Medieval  Eng- 
lish] Royal  household  and  estates  which  regularly  used  tokens 
of  various  kinds  for  the  purpose  of  making  small  payments.  So 
unimportant  indeed  was  the  coinage  that  sometimes  Kings  did 
not  hesitate  to  call  it  all  in  for  re-minting  and  re-issue  and  still 
commerce  went  on  just  the  same.36 

In  fact,  our  standard  account  of  monetary  history  is  precisely 
backwards.  We  did  not  begin  with  barter,  discover  money,  and  then 
eventually  develop  credit  systems.  It  happened  precisely  the  other  way 
around.  What  we  now  call  virtual  money  came  first.  Coins  came  much 
later,  and  their  use  spread  only  unevenly,  never  completely  replacing 
credit  systems.  Barter,  in  turn,  appears  to  be  largely  a  kind  of  acciden- 
tal byproduct  of  the  use  of  coinage  or  paper  money:  historically,  it  has 
mainly  been  what  people  who  are  used  to  cash  transactions  do  when 
for  one  reason  or  another  they  have  no  access  to  currency. 

The  curious  thing  is  that  it  never  happened.  This  new  history  was 
never  written.  It's  not  that  any  economist  has  ever  refuted  Mitchell-Innes. 
They  just  ignored  him.  Textbooks  did  not  change  their  story — even  if 



all  the  evidence  made  clear  that  the  story  was  simply  wrong.  People 
still  write  histories  of  money  that  are  actually  histories  of  coinage,  on 
the  assumption  that  in  the  past,  these  were  necessarily  the  same  thing; 
periods  when  coinage  largely  vanished  are  still  described  as  times  when 
the  economy  "reverted  to  barter,"  as  if  the  meaning  of  this  phrase  is 
self-evident,  even  though  no  one  actually  knows  what  it  means.  As  a 
result  we  have  next-to-no  idea  how,  say,  the  inhabitant  of  a  Dutch 
town  in  950  ad  actually  went  about  acquiring  cheese  or  spoons  or  hir- 
ing musicians  to  play  at  his  daughter's  wedding — let  alone  how  any  of 
this  was  likely  to  be  arranged  in  Pemba  or  Samarkand.'7 

Chapter  Three 


In  being  born  every  being  is  born  as 
debt  owed  to  the  gods,  the  saints,  the 
Fathers  and  to  men.  If  one  makes  a  sac- 
rifice, it  is  because  of  a  debt  owing  to 
the  gods  from  birth  .  .  .  If  one  recites  a 
sacred  text,  it  is  because  of  a  debt  owing 
to  the  saints  .  .  .  If  one  wishes  for  off- 
spring, it  is  because  of  a  debt  due  to  the 
fathers  from  birth  .  .  .  And  if  one  gives 
hospitality,  it  is  because  it  is  a  debt  ow- 
ing to  men. 

— Satapatha  Brahmana  1.7.12,  1-6 

Let  us  drive  away  the  evil  effects  of  bad 
dreams,  just  as  we  pay  off  debts. 

— Rig  Veda  8.47.17 

THE  REASON  THAT  economics  textbooks  now  begin  with  imaginary 
villages  is  because  it  has  been  impossible  to  talk  about  real  ones.  Even 
some  economists  have  been  forced  to  admit  that  Smith's  Land  of  Barter 
doesn't  really  exist.1 

The  question  is  why  the  myth  has  been  perpetuated,  anyway. 
Economists  have  long  since  jettisoned  other  elements  of  The  Wealth  of 
Nations — for  instance,  Smith's  labor  theory  of  value  and  disapproval 
of  joint-stock  corporations.  Why  not  simply  write  off  the  myth  of  bar- 
ter as  a  quaint  Enlightenment  parable,  and  instead  attempt  to  under- 
stand primordial  credit  arrangements — or  anyway,  something  more  in 
keeping  with  the  historical  evidence? 

The  answer  seems  to  be  that  the  Myth  of  Barter  cannot  go  away, 
because  it  is  central  to  the  entire  discourse  of  economics. 



Recall  here  what  Smith  was  trying  to  do  when  he  wrote  The 
Wealth  of  Nations.  Above  all,  the  book  was  an  attempt  to  establish 
the  newfound  discipline  of  economics  as  a  science.  This  meant  that  not 
only  did  economics  have  its  own  peculiar  domain  of  study — what  we 
now  call  "the  economy,"  though  the  idea  that  there  even  was  some- 
thing called  an  "economy"  was  very  new  in  Smith's  day — but  that 
this  economy  operated  according  to  laws  of  much  the  same  sort  as 
Sir  Isaac  Newton  had  so  recently  identified  as  governing  the  physical 
world.  Newton  had  represented  God  as  a  cosmic  watchmaker  who  had 
created  the  physical  machinery  of  the  universe  in  such  a  way  that  it 
would  operate  for  the  ultimate  benefit  of  humans,  and  then  let  it  run 
on  its  own.  Smith  was  trying  to  make  a  similar,  Newtonian  argument.2 
God — or  Divine  Providence,  as  he  put  it — had  arranged  matters  in 
such  a  way  that  our  pursuit  of  self-interest  would  nonetheless,  given  an 
unfettered  market,  be  guided  "as  if  by  an  invisible  hand"  to  promote 
the  general  welfare.  Smith's  famous  invisible  hand  was,  as  he  says  in 
his  Theory  of  Moral  Sentiments,  the  agent  of  Divine  Providence.  It  was 
literally  the  hand  of  God.' 

Once  economics  had  been  established  as  a  discipline,  the  theological 
arguments  no  longer  seemed  necessary  or  important.  People  continue 
to  argue  about  whether  an  unfettered  free  market  really  will  produce 
the  results  that  Smith  said  it  would;  but  no  one  questions  whether  "the 
market"  naturally  exists.  The  underlying  assumptions  that  derive  from 
this  came  to  be  seen  as  common  sense — so  much  so  that,  as  I've  noted, 
we  simply  assume  that  when  valuable  objects  do  change  hands,  it  will 
normally  be  because  two  individuals  have  both  decided  they  would 
gain  a  material  advantage  by  swapping  them.  One  interesting  corollary 
is  that,  as  a  result,  economists  have  come  to  see  the  very  question  of 
the  presence  or  absence  of  money  as  not  especially  important,  since 
money  is  just  a  commodity,  chosen  to  facilitate  exchange,  and  which 
we  use  to  measure  the  value  of  other  commodities.  Otherwise,  it  has  no 
special  qualities.  Still,  in  1958,  Paul  Samuelson,  one  of  the  leading  lights 
of  the  neoclassical  school  that  still  predominates  in  modern  economic 
thought,  could  express  disdain  for  what  he  called  "the  social  contriv- 
ance of  money."  "Even  in  the  most  advanced  industrial  economies,"  he 
insisted,  "if  we  strip  exchange  down  to  its  barest  essentials  and  peel  off 
the  obscuring  layer  of  money,  we  find  that  trade  between  individuals 
and  nations  largely  boils  down  to  barter."4  Others  spoke  of  a  "veil  of 
money"  obscuring  the  nature  of  the  "real  economy"  in  which  people 
produced  real  goods  and  services  and  swapped  them  back  and  forth.5 

Call  this  the  final  apotheosis  of  economics  as  common  sense. 
Money  is  unimportant.  Economies — "real  economies" — are  really  vast 



barter  systems.  The  problem  is  that  history  shows  that  without  money, 
such  vast  barter  systems  do  not  occur.  Even  when  economies  "revert  to 
barter,"  as  Europe  was  said  to  do  in  the  Middle  Ages,  they  don't  actu- 
ally abandon  the  use  of  money.  They  just  abandon  the  use  of  cash.  In 
the  Middle  Ages,  for  instance,  everyone  continued  to  assess  the  value 
of  tools  and  livestock  in  the  old  Roman  currency,  even  if  the  coins 
themselves  had  ceased  to  circulate.6 

It's  money  that  had  made  it  possible  for  us  to  imagine  ourselves  in 
the  way  economists  encourage  us  to  do:  as  a  collection  of  individuals 
and  nations  whose  main  business  is  swapping  things.  It's  also  clear  that 
the  mere  existence  of  money,  in  itself,  is  not  enough  to  allow  us  see  the 
world  this  way.  If  it  were,  the  discipline  of  economics  would  have  been 
created  in  ancient  Sumer,  or  anyway,  far  earlier  than  1776,  when  Adam 
Smith's  The  Wealth  of  Nations  appeared. 

The  missing  element  is  in  fact  exactly  the  thing  Smith  was  at- 
tempting to  downplay:  the  role  of  government  policy.  In  England,  in 
Smith's  day,  it  became  possible  to  see  the  market,  the  world  of  butch- 
ers, ironmongers,  and  haberdashers,  as  its  own  entirely  independent 
sphere  of  human  activity  because  the  British  government  was  actively 
engaged  in  fostering  it.  This  required  laws  and  police,  but  also,  specific 
monetary  policies,  which  liberals  like  Smith  were  (successfully)  advo- 
cating.7 It  required  pegging  the  value  of  the  currency  to  silver,  but  at 
the  same  time  greatly  increasing  the  money  supply,  and  particularly 
the  amount  of  small  change  in  circulation.  This  not  only  required 
huge  amounts  of  tin  and  copper,  but  also  the  careful  regulation  of  the 
banks  that  were,  at  that  time,  the  only  source  of  paper  money.  The 
century  before  The  Wealth  of  Nations  had  seen  at  least  two  attempts 
to  create  state-supported  central  banks,  in  France  and  Sweden,  that 
had  proven  to  be  spectacular  failures.  In  each  case,  the  would-be  cen- 
tral bank  issued  notes  based  largely  on  speculation  that  collapsed  the 
moment  investors  lost  faith.  Smith  supported  the  use  of  paper  money, 
but  like  Locke  before  him,  he  also  believed  that  the  relative  success 
of  the  Bank  of  England  and  Bank  of  Scotland  had  been  due  to  their 
policy  of  pegging  paper  money  firmly  to  precious  metals.  This  became 
the  mainstream  economic  view,  so  much  so  that  alternative  theories  of 
money  as  credit — the  one  that  Mitchell-Innes  advocated — were  quickly 
relegated  to  the  margins,  their  proponents  written  off  as  cranks,  and 
the  very  sort  of  thinking  that  led  to  bad  banks  and  speculative  bubbles 
in  the  first  place. 

It  might  be  helpful,  then,  to  consider  what  these  alternative  theo- 
ries actually  were. 



State  and  Credit  Theories  of  Money 

Mitchell-Innes  was  an  exponent  of  what  came  to  be  known  as  the 
Credit  Theory  of  money,  a  position  that  over  the  course  of  the  nine- 
teenth century  had  its  most  avid  proponents  not  in  Mitchell-Innes's 
native  Britain  but  in  the  two  up-and-coming  rival  powers  of  the  day, 
the  United  States  and  Germany.  Credit  Theorists  insisted  that  money 
is  not  a  commodity  but  an  accounting  tool.  In  other  words,  it  is  not  a 
"thing"  at  all.  You  can  no  more  touch  a  dollar  or  a  deutschmark  than 
you  can  touch  an  hour  or  a  cubic  centimeter.  Units  of  currency  are 
merely  abstract  units  of  measurement,  and  as  the  credit  theorists  cor- 
rectly noted,  historically,  such  abstract  systems  of  accounting  emerged 
long  before  the  use  of  any  particular  token  of  exchange.8 

The  obvious  next  question  is:  If  money  is  a  just  a  yardstick,  what 
then  does  it  measure?  The  answer  was  simple:  debt.  A  coin  is,  effec- 
tively, an  IOU.  Whereas  conventional  wisdom  holds  that  a  banknote  is, 
or  should  be,  a  promise  to  pay  a  certain  amount  of  "real  money"  (gold, 
silver,  whatever  that  might  be  taken  to  mean),  Credit  Theorists  argued 
that  a  banknote  is  simply  the  promise  to  pay  something  of  the  same 
value  as  an  ounce  of  gold.  But  that's  all  that  money  ever  is.  There's 
no  fundamental  difference  in  this  respect  between  a  silver  dollar,  a 
Susan  B.  Anthony  dollar  coin  made  of  a  copper-nickel  alloy  designed 
to  look  vaguely  like  gold,  a  green  piece  of  paper  with  a  picture  of 
George  Washington  on  it,  or  a  digital  blip  on  some  bank's  computer. 
Conceptually,  the  idea  that  a  piece  of  gold  is  really  just  an  IOU  is 
always  rather  difficult  to  wrap  one's  head  around,  but  something  like 
this  must  be  true,  because  even  when  gold  and  silver  coins  were  in  use, 
they  almost  never  circulated  at  their  bullion  value. 

How  could  credit  money  come  about?  Let  us  return  to  the  econom- 
ics professors'  imaginary  town.  Say,  for  example,  that  Joshua  were 
to  give  his  shoes  to  Henry,  and,  rather  than  Henry  owing  him  a  fa- 
vor, Henry  promises  him  something  of  equivalent  value.9  Henry  gives 
Joshua  an  IOU.  Joshua  could  wait  for  Henry  to  have  something  use- 
ful, and  then  redeem  it.  In  that  case  Henry  would  rip  up  the  IOU  and 
the  story  would  be  over.  But  say  Joshua  were  to  pass  the  IOU  on  to  a 
third  party — Sheila — to  whom  he  owes  something  else.  He  could  tick 
it  off  against  his  debt  to  a  fourth  party,  Lola — now  Henry  will  owe 
that  amount  to  her.  Hence  is  money  born.  Because  there's  no  logical 
end  to  it.  Say  Sheila  now  wishes  to  acquire  a  pair  of  shoes  from  Edith; 
she  can  just  hand  Edith  the  IOU,  and  assure  her  that  Henry  is  good 
for  it.  In  principle,  there's  no  reason  that  the  IOU  could  not  continue 



circulating  around  town  for  years — provided  people  continue  to  have 
faith  in  Henry.  In  fact,  if  it  goes  on  long  enough,  people  might  forget 
about  the  issuer  entirely.  Things  like  this  do  happen.  The  anthropolo- 
gist Keith  Hart  once  told  me  a  story  about  his  brother,  who  in  the  '50s 
was  a  British  soldier  stationed  in  Hong  Kong.  Soldiers  used  to  pay  their 
bar  tabs  by  writing  checks  on  accounts  back  in  England.  Local  mer- 
chants would  often  simply  endorse  them  over  to  each  other  and  pass 
them  around  as  currency:  once,  he  saw  one  of  his  own  checks,  written 
six  months  before,  on  the  counter  of  a  local  vendor  covered  with  about 
forty  different  tiny  inscriptions  in  Chinese. 

What  credit  theorists  like  Mitchell-Innes  were  arguing  is  that  even 
if  Henry  gave  Joshua  a  gold  coin  instead  of  a  piece  of  paper,  the  situ- 
ation would  be  essentially  the  same.  A  gold  coin  is  a  promise  to  pay 
something  else  of  equivalent  value  to  a  gold  coin.  After  all,  a  gold  coin 
is  not  actually  useful  in  itself.  One  only  accepts  it  because  one  assumes 
other  people  will. 

In  this  sense,  the  value  of  a  unit  of  currency  is  not  the  measure 
of  the  value  of  an  object,  but  the  measure  of  one's  trust  in  other 
human  beings. 

This  element  of  trust  of  course  makes  everything  more  compli- 
cated. Early  banknotes  circulated  via  a  process  almost  exactly  like 
what  I've  just  described,  except  that,  like  the  Chinese  merchants,  each 
recipient  added  his  or  her  signature  to  guarantee  the  debt's  legitimacy. 
But  generally,  the  difficulty  in  the  Chartalist  position — this  is  what 
it  came  to  be  called,  from  the  Latin  charta,  or  token — is  to  establish 
why  people  would  continue  to  trust  a  piece  of  paper.  After  all,  why 
couldn't  anyone  just  sign  Henry's  name  on  an  IOU?  True,  this  sort 
of  debt-token  system  might  work  within  a  small  village  where  every- 
one knew  one  another,  or  even  among  a  more  dispersed  community 
like  sixteenth-century  Italian  or  twentieth-century  Chinese  merchants, 
where  everyone  at  least  had  ways  of  keeping  track  of  everybody  else. 
But  systems  like  these  cannot  create  a  full-blown  currency  system,  and 
there's  no  evidence  that  they  ever  have.  Providing  a  sufficient  number 
of  IOUs  to  allow  everyone  even  in  a  medium-sized  city  to  be  able  to 
carry  out  a  significant  portion  of  their  daily  transactions  in  such  cur- 
rency would  require  millions  of  tokens.10  To  be  able  to  guarantee  all  of 
them,  Henry  would  have  to  be  almost  unimaginably  rich. 

All  this  would  be  much  less  of  a  problem,  however,  if  Henry  were, 
say,  Henry  II,  King  of  England,  Duke  of  Normandy,  Lord  of  Ireland, 
and  Count  of  Anjou. 

The  real  impetus  for  the  Chartalist  position,  in  fact,  came  out  of 
what  came  to  be  known  as  the  "German  Historical  School,"  whose 



most  famous  exponent  was  the  historian  G.F.  Knapp,  whose  State 
Theory  of  Money  first  appeared  in  1905. 11  If  money  is  simply  a  unit 
of  measure,  it  makes  sense  that  emperors  and  kings  should  concern 
themselves  with  such  matters.  Emperors  and  kings  are  almost  always 
concerned  to  established  uniform  systems  of  weights  and  measures 
throughout  their  kingdoms.  It  is  also  true,  as  Knapp  observed,  that 
once  established,  such  systems  tend  to  remain  remarkably  stable  over 
time.  During  the  reign  of  the  actual  Henry  II  (1154-1189),  just  about 
everyone  in  Western  Europe  was  still  keeping  their  accounts  using  the 
monetary  system  established  by  Charlemagne  some  350  years  earlier — 
that  is,  using  pounds,  shillings,  and  pence — despite  the  fact  that  some 
of  these  coins  had  never  existed  (Charlemagne  never  actually  struck 
a  silver  pound),  none  of  Charlemagne's  actual  shillings  and  pence  re- 
mained in  circulation,  and  those  coins  that  did  circulate  tended  to 
vary  enormously  in  size,  weight,  purity,  and  value.12  According  to  the 
Chartalists,  this  doesn't  really  matter.  What  matters  is  that  there  is  a 
uniform  system  for  measuring  credits  and  debts,  and  that  this  system 
remains  stable  over  time.  The  case  of  Charlemagne's  currency  is  par- 
ticularly dramatic  because  his  actual  empire  dissolved  quite  quickly, 
but  the  monetary  system  he  created  continued  to  be  used,  for  keeping 
accounts,  within  his  former  territories  for  more  than  800  years.  It  was 
referred  to,  in  the  sixteenth  century,  quite  explicitly  as  "imaginary 
money,"  and  derniers  and  livres  were  only  completely  abandoned,  as 
units  of  account,  around  the  time  of  the  French  Revolution.13 

According  to  Knapp,  whether  or  not  the  actual,  physical  money 
stuff  in  circulation  corresponds  to  this  "imaginary  money"  is  not  par- 
ticularly important.  It  makes  no  real  difference  whether  it's  pure  sil- 
ver, debased  silver,  leather  tokens,  or  dried  cod — provided  the  state 
is  willing  to  accept  it  in  payment  of  taxes.  Because  whatever  the  state 
was  willing  to  accept,  for  that  reason,  became  currency.  One  of  the 
most  important  forms  of  currency  in  England  in  Henry's  time  were 
notched  "tally  sticks"  used  to  record  debts.  Tally  sticks  were  quite 
explicitly  IOUs:  both  parties  to  a  transaction  would  take  a  hazelwood 
twig,  notch  it  to  indicate  the  amount  owed,  and  then  split  it  in  half. 
The  creditor  would  keep  one  half,  called  "the  stock"  (hence  the  origin 
of  the  term  "stock  holder")  and  the  debtor  kept  the  other,  called  "the 
stub"  (hence  the  origin  of  the  term  "ticket  stub.")  Tax  assessors  used 
such  twigs  to  calculate  amounts  owed  by  local  sheriffs.  Often,  though, 
rather  than  wait  for  the  taxes  to  come  due,  Henry's  exchequer  would 
often  sell  the  tallies  at  a  discount,  and  they  would  circulate,  as  tokens 
of  debt  owed  to  the  government,  to  anyone  willing  to  trade  for  them.14 



Modern  Banknotes  actually  work  on  a  similar  principle,  except  in 
reverse.15  Recall  here  the  little  parable  about  Henry's  IOU.  The  reader 
might  have  noticed  one  puzzling  aspect  of  the  equation:  the  IOU  can 
operate  as  money  only  as  long  as  Henry  never  pays  his  debt.  In  fact  this 
is  precisely  the  logic  on  which  the  Bank  of  England — the  first  successful 
modern  central  bank — was  originally  founded.  In  1694,  a  consortium 
of  English  bankers  made  a  loan  of  £1,200,000  to  the  king.  In  return 
they  received  a  royal  monopoly  on  the  issuance  of  banknotes.  What 
this  meant  in  practice  was  they  had  the  right  to  advance  IOUs  for  a 
portion  of  the  money  the  king  now  owed  them  to  any  inhabitant  of  the 
kingdom  willing  to  borrow  from  them,  or  willing  to  deposit  their  own 
money  in  the  bank — in  effect,  to  circulate  or  "monetize"  the  newly 
created  royal  debt.  This  was  a  great  deal  for  the  bankers  (they  got 
to  charge  the  king  8  percent  annual  interest  for  the  original  loan  and 
simultaneously  charge  interest  on  the  same  money  to  the  clients  who 
borrowed  it),  but  it  only  worked  as  long  as  the  original  loan  remained 
outstanding.  To  this  day,  this  loan  has  never  been  paid  back.  It  cannot 
be.  If  it  ever  were,  the  entire  monetary  system  of  Great  Britain  would 
cease  to  exist.16 

If  nothing  else,  this  approach  helps  solve  one  of  the  obvious  mys- 
teries of  the  fiscal  policy  of  so  many  early  kingdoms:  Why  did  they 
make  subjects  pay  taxes  at  all?  This  is  not  a  question  we're  used  to 
asking.  The  answer  seems  self-evident.  Governments  demand  taxes  be- 
cause they  wish  to  get  their  hands  on  people's  money.  But  if  Smith  was 
right,  and  gold  and  silver  became  money  through  the  natural  workings 
of  the  market  completely  independently  of  governments,  then  wouldn't 
the  obvious  thing  be  to  just  grab  control  of  the  gold  and  silver  mines? 
Then  the  king  would  have  all  the  money  he  could  possibly  need.  In 
fact,  this  is  what  ancient  kings  would  normally  do.  If  there  were  gold 
and  silver  mines  in  their  territory,  they  would  usually  take  control  of 
them.  So  what  exactly  was  the  point  of  extracting  the  gold,  stamping 
one's  picture  on  it,  causing  it  to  circulate  among  one's  subjects — and 
then  demanding  that  those  same  subjects  give  it  back  again? 

This  does  seem  a  bit  of  a  puzzle.  But  if  money  and  markets  do  not 
emerge  spontaneously,  it  actually  makes  perfect  sense.  Because  this  is 
the  simplest  and  most  efficient  way  to  bring  markets  into  being.  Let 
us  take  a  hypothetical  example.  Say  a  king  wishes  to  support  a  stand- 
ing army  of  fifty  thousand  men.  Under  ancient  or  medieval  conditions, 
feeding  such  a  force  was  an  enormous  problem — unless  they  were  on 
the  march,  one  would  need  to  employ  almost  as  many  men  and  ani- 
mals just  to  locate,  acquire,  and  transport  the  necessary  provisions.17 
On  the  other  hand,  if  one  simply  hands  out  coins  to  the  soldiers  and 



then  demands  that  every  family  in  the  kingdom  was  obliged  to  pay 
one  of  those  coins  back  to  you,  one  would,  in  one  blow,  turn  one's 
entire  national  economy  into  a  vast  machine  for  the  provisioning  of 
soldiers,  since  now  every  family,  in  order  to  get  their  hands  on  the 
coins,  must  find  some  way  to  contribute  to  the  general  effort  to  provide 
soldiers  with  things  they  want.  Markets  are  brought  into  existence  as  a 
side  effect. 

This  is  a  bit  of  a  cartoon  version,  but  it  is  very  clear  that  markets 
did  spring  up  around  ancient  armies;  one  need  only  take  a  glance  at 
Kautilya's  Arthasasatra,  the  Sassanian  "circle  of  sovereignty,"  or  the 
Chinese  "Discourses  on  Salt  and  Iron"  to  discover  that  most  ancient 
rulers  spent  a  great  deal  of  their  time  thinking  about  the  relation  be- 
tween mines,  soldiers,  taxes,  and  food.  Most  concluded  that  the  cre- 
ation of  markets  of  this  sort  was  not  just  convenient  for  feeding  sol- 
diers, but  useful  in  all  sorts  of  ways,  since  it  meant  officials  no  longer 
had  to  requisition  everything  they  needed  directly  from  the  populace, 
or  figure  out  a  way  to  produce  it  on  royal  estates  or  royal  workshops. 
In  other  words,  despite  the  dogged  liberal  assumption — again,  com- 
ing from  Smith's  legacy — that  the  existence  of  states  and  markets  are 
somehow  opposed,  the  historical  record  implies  that  exactly  the  op- 
posite is  the  case.  Stateless  societies  tend  also  to  be  without  markets. 

As  one  might  imagine,  state  theories  of  money  have  always  been 
anathema  to  mainstream  economists  working  in  the  tradition  of  Adam 
Smith.  In  fact,  Chartalism  has  tended  to  be  seen  as  a  populist  underside 
of  economic  theory,  favored  mainly  by  cranks.18  The  curious  thing  is 
that  the  mainstream  economists  often  ended  up  actually  working  for 
governments  and  advising  such  governments  to  pursue  policies  much 
like  those  the  Chartalists  described — that  is,  tax  policies  designed  to 
create  markets  where  they  had  not  existed  before — despite  the  fact 
that  they  were  in  theory  committed  to  Smith's  argument  that  markets 
develop  spontaneously  of  their  own  accord. 

This  was  particularly  true  in  the  colonial  world.  To  return  to  Mad- 
agascar for  a  moment:  I  have  already  mentioned  that  one  of  the  first 
things  that  the  French  general  Gallieni,  conqueror  of  Madagascar,  did 
when  the  conquest  of  the  island  was  complete  in  1901  was  to  impose 
a  head  tax.  Not  only  was  this  tax  quite  high,  it  was  also  only  payable 
in  newly  issued  Malagasy  francs.  In  other  words,  Gallieni  did  indeed 
print  money  and  then  demand  that  everyone  in  the  country  give  some 
of  that  money  back  to  him. 

Most  striking  of  all,  though,  was  language  he  used  to  describe  this 
tax.  It  was  referred  to  as  the  "impot  moralisateur,"  the  "educational" 
or  "moralizing  tax."  In  other  words,  it  was  designed — to  adopt  the 



language  of  the  day — to  teach  the  natives  the  value  of  work.  Since 
the  "educational  tax"  came  due  shortly  after  harvest  time,  the  easiest 
way  for  farmers  to  pay  it  was  to  sell  a  portion  of  their  rice  crop  to  the 
Chinese  or  Indian  merchants  who  soon  installed  themselves  in  small 
towns  across  the  country.  However,  harvest  was  when  the  market 
price  of  rice  was,  for  obvious  reasons,  at  its  lowest;  if  one  sold  too 
much  of  one's  crop,  that  meant  one  would  not  have  enough  left  to 
feed  one's  family  for  the  entire  year,  and  thus  be  forced  to  buy  one's 
own  rice  back,  on  credit,  from  those  same  merchants  later  in  the  year 
when  prices  were  much  higher.  As  a  result,  farmers  quickly  fell  hope- 
lessly into  debt  (the  merchants  doubling  as  loan  sharks).  The  easiest 
ways  to  pay  back  the  debt  was  either  to  find  some  kind  of  cash  crop 
to  sell — to  start  growing  coffee,  or  pineapples — or  else  to  send  one's 
children  off  to  work  for  wages  in  the  city,  or  on  one  of  the  plantations 
that  French  colonists  were  establishing  across  the  island.  The  whole 
project  might  seem  no  more  than  a  cynical  scheme  to  squeeze  cheap 
labor  out  of  the  peasantry,  and  it  was  that,  but  it  was  also  something 
more.  The  colonial  government  was  were  also  quite  explicit  (at  least 
in  their  own  internal  policy  documents),  about  the  need  to  make  sure 
that  peasants  had  at  least  some  money  of  their  own  left  over,  and  to 
ensure  that  they  became  accustomed  to  the  minor  luxuries — parasols, 
lipstick,  cookies — available  at  the  Chinese  shops.  It  was  crucial  that 
they  develop  new  tastes,  habits,  and  expectations;  that  they  lay  the 
foundations  of  a  consumer  demand  that  would  endure  long  after  the 
conquerors  had  left,  and  keep  Madagascar  forever  tied  to  France. 

Most  people  are  not  stupid,  and  most  Malagasy  understood  ex- 
actly what  their  conquerors  were  trying  to  do  to  them.  Some  were 
determined  to  resist.  More  than  sixty  years  after  the  invasion,  a  French 
anthropologist,  Gerard  Althabe,  was  able  to  observe  villages  on  the 
east  coast  of  the  island  whose  inhabitants  would  dutifully  show  up  at 
the  coffee  plantations  to  earn  the  money  for  their  poll  tax,  and  then, 
having  paid  it,  studiously  ignore  the  wares  for  sale  at  the  local  shops 
and  instead  turn  over  any  remaining  money  to  lineage  elders,  who 
would  then  use  it  to  buy  cattle  for  sacrifice  to  their  ancestors.19  Many 
were  quite  open  in  saying  that  they  saw  themselves  as  resisting  a  trap. 

Still,  such  defiance  rarely  lasts  forever.  Markets  did  gradually  take 
shape,  even  in  those  parts  of  the  island  where  none  had  previously 
existed.  With  them  came  the  inevitable  network  of  little  shops.  And  by 
the  time  I  got  there,  in  1990,  a  generation  after  the  poll  tax  had  finally 
been  abolished  by  a  revolutionary  government,  the  logic  of  the  market 
had  become  so  intuitively  accepted  that  even  spirit  mediums  were  recit- 
ing passages  that  might  as  well  have  come  from  Adam  Smith. 



Such  examples  could  be  multiplied  endlessly.  Something  like  this 
occurred  in  just  about  every  part  of  the  world  conquered  by  European 
arms  where  markets  were  not  already  in  place.  Rather  than  discovering 
barter,  they  ended  up  using  the  very  techniques  that  mainstream  eco- 
nomics rejected  to  bring  something  like  the  market  into  being. 

In  Search  of  a  Myth 

Anthropologists  have  been  complaining  about  the  Myth  of  Barter  for 
almost  a  century.  Occasionally,  economists  point  out  with  slight  ex- 
asperation that  there's  a  fairly  simple  reason  why  they're  still  telling 
the  same  story  despite  all  the  evidence  against  it:  anthropologists  have 
never  come  up  with  a  better  one.20  This  is  an  understandable  objection, 
but  there's  a  simple  answer  to  it.  The  reasons  why  anthropologists 
haven't  been  able  to  come  up  with  a  simple,  compelling  story  for  the 
origins  of  money  is  because  there's  no  reason  to  believe  there  could  be 
one.  Money  was  no  more  ever  "invented"  than  music  or  mathematics 
or  jewelry.  What  we  call  "money"  isn't  a  "thing"  at  all,  it's  a  way  of 
comparing  things  mathematically,  as  proportions:  of  saying  one  of  X  is 
equivalent  to  six  of  Y.  As  such  it  is  probably  as  old  as  human  thought. 
The  moment  we  try  to  get  any  more  specific,  we  discover  that  there 
are  any  number  of  different  habits  and  practices  that  have  converged 
in  the  stuff  we  now  call  "money,"  and  this  is  precisely  the  reason  why 
economists,  historians,  and  the  rest  have  found  it  so  difficult  to  come 
up  with  a  single  definition. 

Credit  Theorists  have  long  been  hobbled  by  the  lack  of  an  equally 
compelling  narrative.  This  is  not  to  say  that  all  sides  in  the  currency 
debates  that  ranged  between  1850  and  1950  were  not  in  the  habit  of 
deploying  mythological  weaponry.  This  was  true  particularly,  perhaps, 
in  the  United  States.  In  1894,  the  Greenbackers,  who  pushed  for  de- 
taching the  dollar  from  gold  entirely  to  allow  the  government  to  spend 
freely  on  job-creation  campaigns,  invented  the  idea  of  the  March  on 
Washington — an  idea  that  was  to  have  endless  resonance  in  U.S.  his- 
tory. L.  Frank  Baum's  book  The  Wonderful  Wizard  of  Oz,  which  ap- 
peared in  1900,  is  widely  recognized  to  be  a  parable  for  the  Populist 
campaign  of  William  Jennings  Bryan,  who  twice  ran  for  president  on 
the  Free  Silver  platform — vowing  to  replace  the  gold  standard  with  a 
bimetallic  system  that  would  allow  the  free  creation  of  silver  money 
alongside  gold.21  As  with  the  Greenbackers,  one  of  the  main  constitu- 
encies for  the  movement  was  debtors:  particularly,  Midwestern  farm 



families  such  as  Dorothy's,  who  had  been  facing  a  massive  wave  of 
foreclosures  during  the  severe  recession  of  the  1890s.  According  to  the 
Populist  reading,  the  Wicked  Witches  of  the  East  and  West  represent 
the  East  and  West  Coast  bankers  (promoters  of  and  benefactors  from 
the  tight  money  supply),  the  Scarecrow  represented  the  farmers  (who 
didn't  have  the  brains  to  avoid  the  debt  trap),  the  Tin  Woodsman  was 
the  industrial  proletariat  (who  didn't  have  the  heart  to  act  in  solidarity 
with  the  farmers),  the  Cowardly  Lion  represented  the  political  class 
(who  didn't  have  the  courage  to  intervene).  The  yellow  brick  road, 
silver  slippers,  emerald  city,  and  hapless  Wizard  presumably  speak  for 
themselves.22  "Oz"  is  of  course  the  standard  abbreviation  for  "ounce."23 
As  an  attempt  to  create  a  new  myth,  Baum's  story  was  remarkably  ef- 
fective. As  political  propaganda,  less  so.  William  Jennings  Bryan  failed 
in  three  attempts  to  win  the  presidency,  the  silver  standard  was  never 
adopted,  and  few  nowadays  even  remember  what  The  Wonderful  Wiz- 
ard of  Oz  was  originally  supposed  to  be  about.24 

For  state-money  theorists  in  particular,  this  has  been  a  problem. 
Stories  about  rulers  using  taxes  to  create  markets  in  conquered  territo- 
ries, or  to  pay  for  soldiers  or  other  state  functions,  are  not  particularly 
inspiring.  German  ideas  of  money  as  the  embodiment  of  national  will 
did  not  travel  very  well. 

Every  time  there  was  a  major  economic  meltdown,  however,  con- 
ventional laissez-faire  economics  took  another  hit.  The  Bryan  cam- 
paigns were  born  as  a  reaction  to  the  Panic  of  1893.  By  the  time  of  the 
Great  Depression  of  the  1930s,  the  very  notion  that  the  market  could 
regulate  itself,  so  long  as  the  government  ensured  that  money  was  safe- 
ly pegged  to  precious  metals,  was  completely  discredited.  From  roughly 
1933  to  1979,  every  major  capitalist  government  reversed  course  and 
adopted  some  version  of  Keynesianism.  Keynesian  orthodoxy  started 
from  the  assumption  that  capitalist  markets  would  not  really  work 
unless  capitalist  governments  were  willing  effectively  to  play  nanny: 
most  famously,  by  engaging  in  massive  deficit  "pump-priming"  during 
downturns.  While  in  the  '80s,  Margaret  Thatcher  in  Britain  and  Ron- 
ald Reagan  in  the  United  States  made  a  great  show  of  rejecting  all  of 
this,  it's  unclear  how  much  they  really  did.25  And  in  any  case,  they  were 
operating  in  the  wake  of  an  even  greater  blow  to  previous  monetary 
orthodoxy:  Richard  Nixon's  decision  in  1971  to  unpeg  the  dollar  from 
precious  metals  entirely,  eliminate  the  international  gold  standard,  and 
introduce  the  system  of  floating  currency  regimes  that  has  dominated 
the  world  economy  ever  since.  This  meant  in  effect  that  all  national 
currencies  were  henceforth,  as  neoclassical  economists  like  to  put  it, 
"fiat  money"  backed  only  by  the  public  trust. 



Now,  John  Maynard  Keynes  himself  was  much  more  open  to  what 
he  liked  to  call  the  "alternative  tradition"  of  credit  and  state  theories 
than  any  economist  of  that  stature  (and  Keynes  is  still  arguably  the  sin- 
gle most  important  economic  thinker  of  the  twentieth  century)  before 
or  since.  At  certain  points  he  immersed  himself  in  it:  he  spent  several 
years  in  the  1920s  studying  Mesopotamian  cuneiform  banking  records 
to  try  to  ascertain  the  origins  of  money — his  "Babylonian  madness," 
as  he  would  later  call  it.26  His  conclusion,  which  he  set  forth  at  the 
very  beginning  of  his  Treatise  on  Money,  his  most  famous  work,  was 
more  or  less  the  only  conclusion  one  could  come  to  if  one  started  not 
from  first  principles,  but  from  a  careful  examination  of  the  historical 
record:  that  the  lunatic  fringe  was,  essentially,  right.  Whatever  its  earli- 
est origins,  for  the  last  four  thousand  years,  money  has  been  effectively 
a  creature  of  the  state.  Individuals,  he  observed,  make  contracts  with 
one  another.  They  take  out  debts,  and  they  promise  payment. 

The  State,  therefore,  comes  in  first  of  all  as  the  authority  of  law 
which  enforces  the  payment  of  the  thing  which  corresponds  to 
the  name  or  description  in  the  contract.  But  it  comes  doubly 
when,  in  addition,  it  claims  the  right  to  determine  and  declare 
what  thing  corresponds  to  the  name,  and  to  vary  its  declara- 
tion from  time  to  time — when,  that  is  to  say  it  claims  the  right 
to  re-edit  the  dictionary.  This  right  is  claimed  by  all  modern 
States  and  has  been  so  claimed  for  some  four  thousand  years 
at  least.  It  is  when  this  stage  in  the  evolution  of  Money  has 
been  reached  that  Knapp's  Chartalism — the  doctrine  that  mon- 
ey is  peculiarly  a  creation  of  the  State — is  fully  realized  .  .  . 
To-day  all  civilized  money  is,  beyond  the  possibility  of  dispute, 

This  does  not  mean  that  the  state  necessarily  creates  money.  Mon- 
ey is  credit,  it  can  be  brought  into  being  by  private  contractual  agree- 
ments (loans,  for  instance).  The  state  merely  enforces  the  agreement 
and  dictates  the  legal  terms.  Hence  Keynes'  next  dramatic  assertion: 
that  banks  create  money,  and  that  there  is  no  intrinsic  limit  to  their 
ability  to  do  so:  since  however  much  they  lend,  the  borrower  will 
have  no  choice  but  to  put  the  money  back  into  some  bank  again,  and 
thus,  from  the  perspective  of  the  banking  system  as  a  whole,  the  total 
number  of  debits  and  credits  will  always  cancel  out.28  The  implications 
were  radical,  but  Keynes  himself  was  not.  In  the  end,  he  was  always 
careful  to  frame  the  problem  in  a  way  that  could  be  reintegrated  into 
the  mainstream  economics  of  his  day. 



Neither  was  Keynes  much  of  a  mythmaker.  Insofar  as  the  alterna- 
tive tradition  has  come  up  with  an  answer  to  the  Myth  of  Barter,  it 
was  not  from  Keynes'  own  efforts  (Keynes  ultimately  decided  that  the 
origins  of  money  were  not  particularly  important)  but  in  the  work  of 
some  contemporary  neo-Keynesians,  who  were  not  afraid  to  follow 
some  of  his  more  radical  suggestions  as  far  as  they  would  go. 

The  real  weak  link  in  state-credit  theories  of  money  was  always  the 
element  of  taxes.  It  is  one  thing  to  explain  why  early  states  demanded 
taxes  (in  order  to  create  markets.)  It's  another  to  ask  "by  what  right?" 
Assuming  that  early  rulers  were  not  simply  thugs,  and  that  taxes  were 
not  simply  extortion — and  no  Credit  Theorist,  to  my  knowledge,  took 
such  a  cynical  view  even  of  early  government — one  must  ask  how  they 
justified  this  sort  of  thing. 

Nowadays,  we  all  think  we  know  the  answer  to  this  question.  We 
pay  our  taxes  so  that  the  government  can  provide  us  with  services.  This 
starts  with  security  services — military  protection  being,  often,  about 
the  only  service  some  early  states  were  really  able  to  provide.  By  now, 
of  course,  the  government  provides  all  sorts  of  things.  All  of  this  is 
said  to  go  back  to  some  sort  of  original  "social  contract"  that  everyone 
somehow  agreed  on,  though  no  one  really  knows  exactly  when  or  by 
whom,  or  why  we  should  be  bound  by  the  decisions  of  distant  ances- 
tors on  this  one  matter  when  we  don't  feel  particularly  bound  by  the 
decisions  of  our  distant  ancestors  on  anything  else.29  All  of  this  makes 
sense  if  you  assume  that  markets  come  before  governments,  but  the 
whole  argument  totters  quickly  once  you  realize  that  they  don't. 

There  is  an  alternative  explanation,  one  created  to  be  in  keeping 
with  the  state-credit  theory  approach.  It's  referred  to  as  "primordial 
debt  theory"  and  it  has  been  developed  largely  in  France,  by  a  team  of 
researchers — not  only  economists  but  anthropologists,  historians,  and 
classicists — originally  assembled  around  the  figures  of  Michel  Aglietta 
and  Andre  Orleans,'0  and  more  recently,  Bruno  Theret,  and  it  has  since 
been  taken  up  by  neo-Keynesians  in  the  United  States  and  the  United 
Kingdom  as  well.31 

It's  a  position  that  has  emerged  quite  recently,  and  at  first,  largely 
amidst  debates  about  the  nature  of  the  euro.  The  creation  of  a  common 
European  currency  sparked  not  only  all  sorts  of  intellectual  debates 
(does  a  common  currency  necessarily  imply  the  creation  of  a  common 
European  state?  Or  of  a  common  European  economy  or  society?  Are 
these  ultimately  the  same  thing?)  but  dramatic  political  ones  as  well. 
The  creation  of  the  euro  zone  was  spearheaded  above  all  by  Germany, 
whose  central  banks  still  see  their  main  goal  as  combating  inflation. 
What's  more,  tight  money  policies  and  the  need  to  balance  budgets 



having  been  used  as  the  main  weapon  to  chip  away  welfare-state  poli- 
cies in  Europe,  it  has  necessarily  become  the  stake  of  political  struggles 
between  bankers  and  pensioners,  creditors  and  debtors,  just  as  heated 
as  those  of  1890s  America. 

The  core  argument  is  that  any  attempt  to  separate  monetary  policy 
from  social  policy  is  ultimately  wrong.  Primordial-debt  theorists  insist 
that  these  have  always  been  the  same  thing.  Governments  use  taxes  to 
create  money,  and  they  are  able  to  do  so  because  they  have  become  the 
guardians  of  the  debt  that  all  citizens  have  to  one  another.  This  debt  is 
the  essence  of  society  itself.  It  exists  long  before  money  and  markets, 
and  money  and  markets  themselves  are  simply  ways  of  chopping  pieces 
of  it  up. 

At  first,  the  argument  goes,  this  sense  of  debt  was  expressed  not 
through  the  state,  but  through  religion.  To  make  the  argument,  Aglietta 
and  Orleans  fixed  on  certain  works  of  early  Sanskrit  religious  literature: 
the  hymns,  prayers,  and  poetry  collected  in  the  Vedas  and  the  Brahma- 
nas,  priestly  commentaries  composed  over  the  centuries  that  followed, 
texts  that  are  now  considered  the  foundations  of  Hindu  thought.  It's 
not  as  odd  a  choice  as  it  might  seem.  These  texts  constitute  the  earliest 
known  historical  reflections  on  the  nature  of  debt. 

Actually,  even  the  very  earliest  Vedic  poems,  composed  sometime 
between  1500  and  1200  bc,  evince  a  constant  concern  with  debt — which 
is  treated  as  synonymous  with  guilt  and  sin.32  There  are  numerous 
prayers  pleading  with  the  gods  to  liberate  the  worshipper  from  the 
shackles  or  bonds  of  debt.  Sometimes  these  seem  to  refer  to  debt  in  the 
literal  sense — Rig  Veda  10.34,  f°r  instance,  has  a  long  description  of 
the  sad  plight  of  gamblers  who  "wander  homeless,  in  constant  fear,  in 
debt,  and  seeking  money."  Elsewhere  it's  clearly  metaphorical. 

In  these  hymns,  Yama,  the  god  of  death,  figures  prominently.  To 
be  in  debt  was  to  have  a  weight  placed  on  you  by  Death.  To  be  under 
any  sort  of  unfulfilled  obligation,  any  unkept  promise,  to  gods  or  to 
men,  was  to  live  in  the  shadow  of  Death.  Often,  even  in  the  very  early 
texts,  debt  seems  to  stand  in  for  a  broader  sense  of  inner  suffering, 
from  which  one  begs  the  gods — particularly  Agni,  who  represents  the 
sacrificial  fire — for  release.  It  was  only  with  the  Brahmanas  that  com- 
mentators started  trying  to  weave  all  this  together  into  a  more  com- 
prehensive philosophy.  The  conclusion:  that  human  existence  is  itself 
a  form  of  debt. 

A  man,  being  born,  is  a  debt;  by  his  own  self  he  is  born  to 
Death,  and  only  when  he  sacrifices  does  he  redeem  himself 
from  Death.33 



Sacrifice  (and  these  early  commentators  were  themselves  sacrificial 
priests)  is  thus  called  "tribute  paid  to  Death."  Or  such  was  the  manner 
of  speaking.  In  reality,  as  the  priests  knew  better  than  anyone,  sacrifice 
was  directed  to  all  the  gods,  not  just  Death — Death  was  just  the  inter- 
mediary. Framing  things  this  way,  though,  did  immediately  raise  the 
one  problem  that  always  comes  up,  whenever  anyone  conceives  human 
life  through  such  an  idiom.  If  our  lives  are  on  loan,  who  would  actually 
wish  to  repay  such  a  debt?  To  live  in  debt  is  to  be  guilty,  incomplete. 
But  completion  can  only  mean  annihilation.  In  this  way,  the  "tribute" 
of  sacrifice  could  be  seen  as  a  kind  of  interest  payment,  with  the  life 
of  the  animal  substituting  temporarily  for  what's  really  owed,  which  is 
ourselves — a  mere  postponement  of  the  inevitable.34 

Different  commentators  proposed  different  ways  out  of  the  dilem- 
ma. Some  ambitious  Brahmins  began  telling  their  clients  that  sacrificial 
ritual,  if  done  correctly,  promised  a  way  to  break  out  of  the  human 
condition  entirely  and  achieve  eternity  (since,  in  the  face  of  eternity,  all 
debts  become  meaningless.)35  Another  way  was  to  broaden  the  notion 
of  debt,  so  that  all  social  responsibilities  become  debts  of  one  sort  or 
another.  Thus  two  famous  passages  in  the  Brahmanas  insist  that  we 
are  born  as  a  debt  not  just  to  the  gods,  to  be  repaid  in  sacrifice,  but 
also  to  the  Sages  who  created  the  Vedic  learning  to  begin  with,  which 
we  must  repay  through  study;  to  our  ancestors  ("the  Fathers"),  who 
we  must  repay  by  having  children;  and  finally,  "to  men" — apparently 
meaning  humanity  as  a  whole,  to  be  repaid  by  offering  hospitality  to 
strangers.36  Anyone,  then,  who  lives  a  proper  life  is  constantly  paying 
back  existential  debts  of  one  sort  or  another;  but  at  the  same  time,  as 
the  notion  of  debt  slides  back  into  a  simple  sense  of  social  obligation, 
it  becomes  something  far  less  terrifying  than  the  sense  that  one's  very 
existence  is  a  loan  taken  against  Death.37  Not  least  because  social  ob- 
ligations always  cut  both  ways.  Especially  since,  once  one  has  oneself 
fathered  children,  one  is  just  as  much  a  debtor  as  a  creditor. 

What  primordial-debt  theorists  have  done  is  to  propose  that  the 
ideas  encoded  in  these  Vedic  texts  are  not  peculiar  to  a  certain  intel- 
lectual tradition  of  early  Iron  Age  ritual  specialists  in  the  Ganges  val- 
ley, but  that  they  are  essential  to  the  very  nature  and  history  of  human 
thought.  Consider  for  example  this  statement,  from  an  essay  by  French 
economist  Bruno  Theret  with  the  uninspiring  title  "The  Socio-Cultural 
Dimensions  of  the  Currency:  Implications  for  the  Transition  to  the 
Euro,"  published  in  the  Journal  of  Consumer  Policy  in  1999: 

At  the  origin  of  money  we  have  a  "relation  of  representa- 
tion" of  death  as  an  invisible  world,  before  and  beyond  life — a 



representation  that  is  the  product  of  the  symbolic  function 
proper  to  the  human  species  and  which  envisages  birth  as  an 
original  debt  incurred  by  all  men,  a  debt  owing  to  the  cosmic 
powers  from  which  humanity  emerged. 

Payment  of  this  debt,  which  can  however  never  be  settled 
on  earth — because  its  full  reimbursement  is  out  of  reach — takes 
the  form  of  sacrifices  which,  by  replenishing  the  credit  of  the 
living,  make  it  possible  to  prolong  life  and  even  in  certain  cases 
to  achieve  eternity  by  joining  the  Gods.  But  this  initial  belief- 
claim  is  also  associated  with  the  emergence  of  sovereign  powers 
whose  legitimacy  resides  in  their  ability  to  represent  the  entire 
original  cosmos.  And  it  is  these  powers  that  invented  money  as 
a  means  of  settling  debts — a  means  whose  abstraction  makes 
it  possible  to  resolve  the  sacrificial  paradox  by  which  put- 
ting to  death  becomes  the  permanent  means  of  protecting  life. 
Through  this  institution,  belief  is  in  turn  transferred  to  a  cur- 
rency stamped  with  the  effigy  of  the  sovereign — a  money  put  in 
circulation  but  whose  return  is  organized  by  this  other  institu- 
tion which  is  the  tax/settlement  of  the  life  debt.  So  money  also 
takes  on  the  function  of  a  means  of  payment.38 

If  nothing  else,  this  provides  a  neat  illustration  of  how  different 
are  standards  of  debate  in  Europe  from  those  current  in  the  Anglo- 
American  world.  One  can't  imagine  an  American  economist  of  any 
stripe  writing  something  like  this.  Still,  the  author  is  actually  making  a 
rather  clever  synthesis  here.  Human  nature  does  not  drive  us  to  "truck 
and  barter."  Rather,  it  ensures  that  we  are  always  creating  symbols — 
such  as  money  itself.  This  is  how  we  come  to  see  ourselves  in  a  cosmos 
surrounded  by  invisible  forces;  as  in  debt  to  the  universe. 

The  ingenious  move  of  course  is  to  fold  this  back  into  the  state 
theory  of  money — since  by  "sovereign  powers"  Theret  actually  means 
"the  state."  The  first  kings  were  sacred  kings  who  were  either  gods  in 
their  own  right  or  stood  as  privileged  mediators  between  human  beings 
and  the  ultimate  forces  that  governed  the  cosmos.  This  sets  us  on  a 
road  to  the  gradual  realization  that  our  debt  to  the  gods  was  always, 
really,  a  debt  to  the  society  that  made  us  what  we  are. 

The  "primordial  debt,"  writes  British  sociologist  Geoffrey  Ingham, 
"is  that  owed  by  the  living  to  the  continuity  and  durability  of  the  soci- 
ety that  secures  their  individual  existence."39  In  this  sense  it  is  not  just 
criminals  who  owe  a  "debt  to  society" — we  are  all,  in  a  certain  sense, 
guilty,  even  criminals. 



For  instance,  Ingham  notes  that,  while  there  is  no  actual  proof  that 
money  emerged  in  this  way,  "there  is  considerable  indirect  etymologi- 
cal evidence": 

In  all  Indo-European  languages,  words  for  "debt"  are  synony- 
mous with  those  for  "sin"  or  "guilt",  illustrating  the  links  be- 
tween religion,  payment  and  the  mediation  of  the  sacred  and 
profane  realms  by  "money."  For  example,  there  is  a  connection 
between  money  (German  Geld),  indemnity  or  sacrifice  (Old 
English  Geild),  tax  (Gothic  Gild)  and,  of  course,  guilt.40 

Or,  to  take  another  curious  connection:  Why  were  cattle  so  often 
used  as  money?  The  German  historian  Bernard  Laum  long  ago  pointed 
out  that  in  Homer,  when  people  measure  the  value  of  a  ship  or  suit  of 
armor,  they  always  measure  it  in  oxen — even  though  when  they  actu- 
ally exchange  things,  they  never  pay  for  anything  in  oxen.  It  is  hard  to 
escape  the  conclusion  that  this  was  because  an  ox  was  what  one  of- 
fered the  gods  in  sacrifice.  Hence  they  represented  absolute  value.  From 
Sumer  to  Classical  Greece,  silver  and  gold  were  dedicated  as  offerings 
in  temples.  Everywhere,  money  seems  to  have  emerged  from  the  thing 
most  appropriate  for  giving  to  the  gods.41 

If  the  king  has  simply  taken  over  guardianship  of  that  primordial 
debt  we  all  owe  to  society  for  having  created  us,  this  provides  a  very 
neat  explanation  for  why  the  government  feels  it  has  the  right  to  make 
us  pay  taxes.  Taxes  are  just  a  measure  of  our  debt  to  the  society  that 
made  us.  But  this  doesn't  really  explain  how  this  kind  of  absolute  life- 
debt  can  be  converted  into  money,  which  is  by  definition  a  means  of 
measuring  and  comparing  the  value  of  different  things.  This  is  just  as 
much  a  problem  for  credit  theorists  as  for  neoclassical  economists,  even 
if  the  problem  for  them  is  somewhat  differently  framed.  If  you  start 
from  the  barter  theory  of  money,  you  have  to  resolve  the  problem  of 
how  and  why  you  would  come  to  select  one  commodity  to  measure  just 
how  much  you  want  each  of  the  other  ones.  If  you  start  from  a  credit 
theory,  you  are  left  with  the  problem  I  described  in  the  first  chapter: 
how  to  turn  a  moral  obligation  into  a  specific  sum  of  money,  how  the 
mere  sense  of  owing  someone  else  a  favor  can  eventually  turn  into  a 
system  of  accounting  in  which  one  is  able  to  calculate  exactly  how 
many  sheep  or  fish  or  chunks  of  silver  it  would  take  to  repay  the  debt. 
Or  in  this  case,  how  do  we  go  from  that  absolute  debt  we  owe  to  God 
to  the  very  specific  debts  we  owe  our  cousins,  or  the  bartender? 

The  answer  provided  by  primordial-debt  theorists  is,  again,  inge- 
nious. If  taxes  represent  our  absolute  debt  to  the  society  that  created 



us,  then  the  first  step  toward  creating  real  money  comes  when  we  start 
calculating  much  more  specific  debts  to  society,  systems  of  fines,  fees, 
and  penalties,  or  even  debts  we  owe  to  specific  individuals  who  we 
have  wronged  in  some  way,  and  thus  to  whom  we  stand  in  a  relation 
of  "sin"  or  "guilt." 

This  is  actually  much  less  implausible  than  it  might  sound.  One  of 
the  puzzling  things  about  all  the  theories  about  the  origins  of  money 
that  we've  been  looking  at  so  far  is  that  they  almost  completely  ig- 
nore the  evidence  of  anthropology.  Anthropologists  do  have  a  great 
deal  of  knowledge  of  how  economies  within  stateless  societies  actually 
worked — how  they  still  work  in  places  where  states  and  markets  have 
been  unable  to  completely  break  up  existing  ways  of  doing  things. 
There  are  innumerable  studies  of,  say,  the  use  of  cattle  as  money  in 
eastern  or  southern  Africa,  of  shell  money  in  the  Americas  (wampum 
being  the  most  famous  example)  or  Papua  New  Guinea,  bead  money, 
feather  money,  the  use  of  iron  rings,  cowries,  spondylus  shells,  brass 
rods,  or  woodpecker  scalps.42  The  reason  that  this  literature  tends  to  be 
ignored  by  economists  is  simple:  "primitive  currencies"  of  this  sort  is 
only  rarely  used  to  buy  and  sell  things,  and  even  when  they  are,  never 
primarily  to  buy  and  sell  everyday  items  such  as  chickens  or  eggs  or 
shoes  or  potatoes.  Rather  than  being  employed  to  acquire  things,  they 
are  mainly  used  to  rearrange  relations  between  people.  Above  all,  to 
arrange  marriages  and  to  settle  disputes,  particularly  those  arising  from 
murders  or  personal  injury. 

There  is  every  reason  to  believe  that  our  own  money  started  the 
same  way — even  the  English  word  "to  pay"  is  originally  derived  from 
a  word  for  "to  pacify,  appease" — as  in,  to  give  someone  something 
precious,  for  instance,  to  express  just  how  badly  you  feel  about  having 
just  killed  his  brother  in  a  drunken  brawl,  and  how  much  you  would 
really  like  to  avoid  this  becoming  the  basis  for  an  ongoing  blood-feud.4' 

Debt  theorists  are  especially  concerned  with  this  latter  possibil- 
ity. This  is  partly  because  they  tend  to  skip  past  the  anthropological 
literature  and  look  at  early  law  codes — taking  inspiration  here,  from 
the  groundbreaking  work  of  one  of  the  twentieth  century's  greatest  nu- 
mismatists, Philip  Grierson,  who  in  the  '70s,  first  suggested  that  money 
might  first  have  emerged  from  early  legal  practice.  Grierson  was  an 
expert  in  the  European  Dark  Ages,  and  he  became  fascinated  by  what 
have  come  to  be  known  as  the  "Barbarian  Law  Codes,"  established  by 
many  Germanic  peoples  after  the  destruction  of  the  Roman  Empire  in 
the  600s  and  700s — Goths,  Frisians,  Franks,  and  so  on — soon  followed 
by  similar  codes  published  everywhere  from  Russia  to  Ireland.  Cer- 
tainly they  are  fascinating  documents.  On  the  one  hand,  they  make  it 



abundantly  clear  just  how  wrong  are  conventional  accounts  of  Europe 
around  this  time  "reverting  to  barter."  Almost  all  of  the  Germanic  law 
codes  use  Roman  money  to  make  assessments;  penalties  for  theft,  for 
instance,  are  almost  always  followed  by  demands  that  the  thief  not 
only  return  the  stolen  property  but  pay  any  outstanding  rent  (or  in  the 
event  of  stolen  money,  interest)  owing  for  the  amount  of  time  it  has 
been  in  his  possession.  On  the  other  hand,  these  were  soon  followed  by 
law  codes  by  people  living  in  territories  that  had  never  been  under  Ro- 
man rule — in  Ireland,  Wales,  Nordic  countries,  Russia — and  these  are 
if  anything  even  more  revealing.  They  could  be  remarkably  creative, 
both  in  what  could  be  used  as  a  means  of  payment  and  on  the  precise 
breakdown  of  injuries  and  insults  that  required  compensation: 

Compensation  in  the  Welsh  laws  is  reckoned  primarily  in  cattle 
and  in  the  Irish  ones  in  cattle  or  bondmaids  (cutnal),  with 
considerable  use  of  precious  metals  in  both.  In  the  Germanic 
codes  it  is  mainly  in  precious  metal  ...  In  the  Russian  codes  it 
was  silver  and  furs,  graduated  from  marten  down  to  squirrel. 
Their  detail  is  remarkable,  not  only  in  the  personal  injuries 
envisioned — specific  compensations  for  the  loss  of  an  arm,  a 
hand,  a  forefinger,  a  nail,  for  a  blow  on  the  head  so  that  the 
brain  is  visible  or  bone  projects — but  in  the  coverage  some  of 
them  gave  to  the  possessions  of  the  individual  household.  Title 
II  of  the  Salic  Law  deals  with  the  theft  of  pigs,  Title  III  with 
cattle,  Title  IV  with  sheep,  Title  V  with  goats,  Title  VI  with 
dogs,  each  time  with  an  elaborate  breakdown  differentiating 
between  animals  of  different  age  and  sex.44 

This  does  make  a  great  deal  of  psychological  sense.  I've  already 
remarked  how  difficult  it  is  to  imagine  how  a  system  of  precise 
equivalences — one  young  healthy  milk  cow  is  equivalent  to  exactly 
thirty-six  chickens — could  arise  from  most  forms  of  gift  exchange.  If 
Henry  gives  Joshua  a  pig  and  feels  he  has  received  an  inadequate 
counter-gift,  he  might  mock  Joshua  as  a  cheapskate,  but  he  would  have 
little  occasion  to  come  up  with  a  mathematical  formula  for  precisely 
how  cheap  he  feels  Joshua  has  been.  On  the  other  hand,  if  Joshua's 
pig  just  destroyed  Henry's  garden,  and  especially,  if  that  led  to  a  fight 
in  which  Henry  lost  a  toe,  and  Henry's  family  is  now  hauling  Joshua 
up  in  front  of  the  village  assembly — this  is  precisely  the  context  where 
people  are  most  likely  to  become  petty  and  legalistic  and  express  out- 
rage if  they  feel  they  have  received  one  groat  less  than  was  their  right- 
ful due.  That  means  exact  mathematical  specificity:  for  instance,  the 



capacity  to  measure  the  exact  value  of  a  two-year-old  pregnant  sow. 
What's  more,  the  levying  of  penalties  must  have  constantly  required 
the  calculation  of  equivalences.  Say  the  fine  is  in  marten  pelts  but  the 
culprit's  clan  doesn't  have  any  martens.  How  many  squirrel  skins  will 
do?  Or  pieces  of  silver  jewelry?  Such  problems  must  have  come  up  all 
the  time  and  led  to  at  least  a  rough-and-ready  set  of  rules  of  thumb 
over  what  sorts  of  valuable  were  equivalent  to  others.  This  would 
help  explain  why,  for  instance,  medieval  Welsh  law  codes  can  contain 
detailed  breakdowns  not  only  of  the  value  of  different  ages  and  condi- 
tions of  milk  cow,  but  of  the  monetary  value  of  every  object  likely  to 
be  found  in  an  ordinary  homestead,  down  to  the  cost  of  each  piece  of 
timber — despite  the  fact  that  there  seems  no  reason  to  believe  that  most 
such  items  could  even  be  purchased  on  the  open  market  at  the  time.45 

There  is  something  very  compelling  in  all  this.  For  one  thing,  the  prem- 
ise makes  a  great  deal  of  intuitive  sense.  After  all,  we  do  owe  every- 
thing we  are  to  others.  This  is  simply  true.  The  language  we  speak  and 
even  think  in,  our  habits  and  opinions,  the  kind  of  food  we  like  to  eat, 
the  knowledge  that  makes  our  lights  switch  on  and  toilets  flush,  even 
the  style  in  which  we  carry  out  our  gestures  of  defiance  and  rebellion 
against  social  conventions — all  of  this,  we  learned  from  other  people, 
most  of  them  long  dead.  If  we  were  to  imagine  what  we  owe  them  as 
a  debt,  it  could  only  be  infinite.  The  question  is:  Does  it  really  make 
sense  to  think  of  this  as  a  debt?  After  all,  a  debt  is  by  definition  some- 
thing that  we  could  at  least  imagine  paying  back.  It  is  strange  enough 
to  wish  to  be  square  with  one's  parents — it  rather  implies  that  one  does 
not  wish  to  think  of  them  as  parents  any  more.  Would  we  really  want 
to  be  square  with  all  humanity?  What  would  that  even  mean?  And  is 
this  desire  really  a  fundamental  feature  of  all  human  thought? 

Another  way  to  put  this  would  be:  Are  primordial-debt  theorists 
describing  a  myth,  have  they  discovered  a  profound  truth  of  the  hu- 
man condition  that  has  always  existed  in  all  societies,  and  is  it  simply 
spelled  out  particularly  clearly  in  certain  ancient  texts  from  India — or 
are  they  inventing  a  myth  of  their  own? 

Clearly  it  must  be  the  latter.  They  are  inventing  a  myth. 

The  choice  of  the  Vedic  material  is  significant.  The  fact  is,  we 
know  almost  nothing  about  the  people  who  composed  these  texts  and 
little  about  the  society  that  created  them.46  We  don't  even  know  if 



interest-bearing  loans  existed  in  Vedic  India — which  obviously  has  a 
bearing  on  whether  priests  really  saw  sacrifice  as  the  payment  of  inter- 
est on  a  loan  we  owe  to  Death.47  As  a  result,  the  material  can  serve  as 
a  kind  of  empty  canvas,  or  a  canvas  covered  with  hieroglyphics  in  an 
unknown  language,  on  which  we  can  project  almost  anything  we  want 
to.  If  we  look  at  other  ancient  civilizations  in  which  we  do  know  some- 
thing about  the  larger  context,  we  find  that  no  such  notion  of  sacrifice 
as  payment  is  in  evidence.48  If  we  look  through  the  work  of  ancient 
theologians,  we  find  that  most  were  familiar  with  the  idea  that  sacrifice 
was  a  way  by  which  human  beings  could  enter  into  commercial  rela- 
tions with  the  gods,  but  that  they  felt  it  was  patently  ridiculous:  If  the 
gods  already  have  everything  they  want,  what  exactly  do  humans  have 
to  bargain  with?49  We've  seen  in  the  last  chapter  how  difficult  it  is  to 
give  gifts  to  kings.  With  gods  (let  alone  God)  the  problem  is  magnified 
infinitely.  Exchange  implies  equality.  In  dealing  with  cosmic  forces,  this 
was  simply  assumed  to  be  impossible  from  the  start. 

The  notion  that  debts  to  gods  were  appropriated  by  the  state, 
and  thus  became  the  bases  for  taxation  systems,  can't  really  stand 
up  either.  The  problem  here  is  that  in  the  ancient  world,  free  citizens 
didn't  usually  pay  taxes.  Generally  speaking,  tribute  was  levied  only  on 
conquered  populations.  This  was  already  true  in  ancient  Mesopotamia, 
where  the  inhabitants  of  independent  cities  did  not  usually  have  to  pay 
direct  taxes  at  all.  Similarly,  as  Moses  Finley  put  it,  "Classical  Greeks 
looked  upon  direct  taxes  as  tyrannical  and  avoided  them  whenever  pos- 
sible.50 Athenian  citizens  did  not  pay  direct  taxes  of  any  sort;  though 
the  city  did  sometimes  distribute  money  to  its  citizens,  a  kind  of  reverse 
taxation — sometimes  directly,  as  with  the  proceeds  of  the  Laurium  sil- 
ver mines,  and  sometimes  indirectly,  as  through  generous  fees  for  jury 
duty  or  attending  the  assembly.  Subject  cities,  however,  did  have  to  pay 
tribute.  Even  within  the  Persian  Empire,  Persians  did  not  have  to  pay 
tribute  to  the  Great  King,  but  the  inhabitants  of  conquered  provinces 
did.51  The  same  was  true  in  Rome,  where  for  a  very  long  time,  Roman 
citizens  not  only  paid  no  taxes  but  had  a  right  to  a  share  of  the  tribute 
levied  on  others,  in  the  form  of  the  dole — the  "bread"  part  of  the  fa- 
mous "bread  and  circuses."52 

In  other  words,  Benjamin  Franklin  was  wrong  when  he  said  that 
in  this  world  nothing  is  certain  except  death  and  taxes.  This  obviously 
makes  the  idea  that  the  debt  to  one  is  just  a  variation  on  the  other 
much  harder  to  maintain. 

None  of  this,  however,  deals  a  mortal  blow  to  the  state  theory 
of  money.  Even  those  states  that  did  not  demand  taxes  did  levy  fees, 
penalties,  tariffs,  and  fines  of  one  sort  or  another.  But  it  is  very  hard 



to  reconcile  with  any  theory  that  claims  states  were  first  conceived  as 
guardians  of  some  sort  of  cosmic,  primordial  debt. 

It's  curious  that  primordial-debt  theorists  never  have  much  to  say 
about  Sumer  or  Babylonia,  despite  the  fact  that  Mesopotamia  is  where 
the  practice  of  loaning  money  at  interest  was  first  invented,  probably 
two  thousand  years  before  the  Vedas  were  composed — and  that  it  was 
also  the  home  of  the  world's  first  states.  But  if  we  look  into  Mesopo- 
tamian  history,  it  becomes  a  little  less  surprising.  Again,  what  we  find 
there  is  in  many  ways  the  exact  opposite  of  what  such  theorists  would 
have  predicted. 

The  reader  will  recall  here  that  Mesopotamian  city-states  were 
dominated  by  vast  Temples:  gigantic,  complex  industrial  institutions 
often  staffed  by  thousands — including  everyone  from  shepherds  and 
barge-pullers  to  spinners  and  weavers  to  dancing  girls  and  clerical  ad- 
ministrators. By  at  least  2700  BC,  ambitious  rulers  had  begun  to  imitate 
them  by  creating  palace  complexes  organized  on  similar  terms — with 
the  exception  that  where  the  Temples  centered  on  the  sacred  chambers 
of  a  god  or  goddess,  represented  by  a  sacred  image  who  was  fed  and 
clothed  and  entertained  by  priestly  servants  as  if  he  or  she  were  a  liv- 
ing person.  Palaces  centered  on  the  chambers  of  an  actual  live  king. 
Sumerian  rulers  rarely  went  so  far  as  to  declare  themselves  gods,  but 
they  often  came  very  close.  However,  when  they  did  interfere  in  the 
lives  of  their  subjects  in  their  capacity  as  cosmic  rulers,  they  did  not 
do  it  by  imposing  public  debts,  but  rather  by  canceling  private  ones.53 

We  don't  know  precisely  when  and  how  interest-bearing  loans 
originated,  since  they  appear  to  predate  writing.  Most  likely,  Temple 
administrators  invented  the  idea  as  a  way  of  financing  the  caravan 
trade.  This  trade  was  crucial  because  while  the  river  valley  of  ancient 
Mesopotamia  was  extraordinarily  fertile  and  produced  huge  surpluses 
of  grain  and  other  foodstuffs,  and  supported  enormous  numbers  of 
livestock,  which  in  turn  supported  a  vast  wool  and  leather  industry,  it 
was  almost  completely  lacking  in  anything  else.  Stone,  wood,  metal, 
even  the  silver  used  as  money,  all  had  to  be  imported.  From  quite  early 
times,  then,  Temple  administrators  developed  the  habit  of  advancing 
goods  to  local  merchants — some  of  them  private,  others  themselves 
Temple  functionaries — who  would  then  go  off  and  sell  it  overseas. 
Interest  was  just  a  way  for  the  Temples  to  take  their  share  of  the  re- 
sulting profits.54  However,  once  established,  the  principle  seems  to  have 
quickly  spread.  Before  long,  we  find  not  only  commercial  loans,  but 
also  consumer  loans — usury  in  the  classical  sense  of  the  term.  By  C2400 
BC  it  already  appears  to  have  been  common  practice  on  the  part  of  lo- 
cal officials,  or  wealthy  merchants,  to  advance  loans  to  peasants  who 



were  in  financial  trouble  on  collateral  and  begin  to  appropriate  their 
possessions  if  they  were  unable  to  pay.  It  usually  started  with  grain, 
sheep,  goats,  and  furniture,  then  moved  on  to  fields  and  houses,  or,  al- 
ternately or  ultimately,  family  members.  Servants,  if  any,  went  quickly, 
followed  by  children,  wives,  and  in  some  extreme  occasions,  even  the 
borrower  himself.  These  would  be  reduced  to  debt-peons:  not  quite 
slaves,  but  very  close  to  that,  forced  into  perpetual  service  in  the  lend- 
er's household — or,  sometimes,  in  the  Temples  or  Palaces  themselves. 
In  theory,  of  course,  any  of  them  could  be  redeemed  whenever  the  bor- 
rower repaid  the  money,  but  for  obvious  reasons,  the  more  a  peasant's 
resources  were  stripped  away  from  him,  the  harder  that  became. 

The  effects  were  such  that  they  often  threatened  to  rip  society 
apart.  If  for  any  reason  there  was  a  bad  harvest,  large  proportions  of 
the  peasantry  would  fall  into  debt  peonage;  families  would  be  bro- 
ken up.  Before  long,  lands  lay  abandoned  as  indebted  farmers  fled 
their  homes  for  fear  of  repossession  and  joined  semi-nomadic  bands 
on  the  desert  fringes  of  urban  civilization.  Faced  with  the  potential 
for  complete  social  breakdown,  Sumerian  and  later  Babylonian  kings 
periodically  announced  general  amnesties:  "clean  slates,"  as  economic 
historian  Michael  Hudson  refers  to  them.  Such  decrees  would  typically 
declare  all  outstanding  consumer  debt  null  and  void  (commercial  debts 
were  not  affected),  return  all  land  to  its  original  owners,  and  allow  all 
debt-peons  to  return  to  their  families.  Before  long,  it  became  more  or 
less  a  regular  habit  for  kings  to  make  such  a  declaration  on  first  as- 
suming power,  and  many  were  forced  to  repeat  it  periodically  over  the 
course  of  their  reigns. 

In  Sumeria,  these  were  called  "declarations  of  freedom" — and  it 
is  significant  that  the  Sumerian  word  amargi,  the  first  recorded  word 
for  "freedom"  in  any  known  human  language,  literally  means  "return 
to  mother" — since  this  is  what  freed  debt-peons  were  finally  allowed 
to  do.55 

Michael  Hudson  argues  that  Mesopotamian  kings  were  only  in 
a  position  to  do  this  because  of  their  cosmic  pretensions:  in  taking 
power,  they  saw  themselves  as  literally  recreating  human  society,  and 
so  were  in  a  position  to  wipe  the  slate  clean  of  all  previous  moral  ob- 
ligations. Still,  this  is  about  as  far  from  what  primordial-debt  theorists 
had  in  mind  as  one  could  possibly  imagine.56 

Probably  the  biggest  problem  in  this  whole  body  of  literature  is  the  ini- 
tial assumption:  that  we  begin  with  an  infinite  debt  to  something  called 



"society."  It's  this  debt  to  society  that  we  project  onto  the  gods.  It's  this 
same  debt  that  then  gets  taken  up  by  kings  and  national  governments. 

What  makes  the  concept  of  society  so  deceptive  is  that  we  assume 
the  world  is  organized  into  a  series  of  compact,  modular  units  called 
"societies,"  and  that  all  people  know  which  one  they're  in.  Histori- 
cally, this  is  very  rarely  the  case.  Imagine  I  am  a  Christian  Armenian 
merchant  living  under  the  reign  of  Genghis  Khan.  What  is  "society" 
for  me?  Is  it  the  city  where  I  grew  up,  the  society  of  international 
merchants  (with  its  own  elaborate  codes  of  conduct)  within  which  I 
conduct  my  daily  affairs,  other  speakers  of  Armenian,  Christendom  (or 
maybe  just  Orthodox  Christendom),  or  the  inhabitants  of  the  Mongol 
empire  itself,  which  stretched  from  the  Mediterranean  to  Korea?  His- 
torically, kingdoms  and  empires  have  rarely  been  the  most  important 
reference  points  in  peoples'  lives.  Kingdoms  rise  and  fall;  they  also 
strengthen  and  weaken;  governments  may  make  their  presence  known 
in  people's  lives  quite  sporadically,  and  many  people  in  history  were 
never  entirely  clear  whose  government  they  were  actually  in.  Even  until 
quite  recently,  many  of  the  world's  inhabitants  were  never  even  quite 
sure  what  country  they  were  supposed  to  be  in,  or  why  it  should  mat- 
ter. My  mother,  who  was  born  a  Jew  in  Poland,  once  told  me  a  joke 
from  her  childhood: 

There  was  a  small  town  located  along  the  frontier  between 
Russia  and  Poland;  no  one  was  ever  quite  sure  to  which  it 
belonged.  One  day  an  official  treaty  was  signed  and  not  long 
after,  surveyors  arrived  to  draw  a  border.  Some  villagers  ap- 
proached them  where  they  had  set  up  their  equipment  on  a 
nearby  hill. 

"So  where  are  we,  Russia  or  Poland?" 

"According  to  our  calculations,  your  village  now  begins  ex- 
actly thirty-seven  meters  into  Poland." 

The  villagers  immediately  began  dancing  for  joy. 

"Why?"  the  surveyors  asked.  "What  difference  does  it 

"Don't  you  know  what  this  means?"  they  replied.  "It  means 
we'll  never  have  to  endure  another  one  of  those  terrible  Rus- 
sian winters!" 

However,  if  we  are  born  with  an  infinite  debt  to  all  those  people 
who  made  our  existence  possible,  but  there  is  no  natural  unit  called 
"society" — then  who  or  what  exactly  do  we  really  owe  it  to?  Everyone? 
Everything?  Some  people  or  things  more  than  others?  And  how  do  we 



pay  a  debt  to  something  so  diffuse?  Or,  perhaps  more  to  the  point,  who 
exactly  can  claim  the  authority  to  tell  us  how  we  can  repay  it,  and  on 
what  grounds? 

If  we  frame  the  problem  that  way,  the  authors  of  the  Brahmanas 
are  offering  a  quite  sophisticated  reflection  on  a  moral  question  that  no 
one  has  really  ever  been  able  to  answer  any  better  before  or  since.  As  I 
say,  we  can't  know  much  about  the  conditions  under  which  those  texts 
were  composed,  but  such  evidence  as  we  do  have  suggests  that  the 
crucial  documents  date  from  sometime  between  500  and  400  bc — that 
is,  roughly  the  time  of  Socrates — which  in  India  appears  to  have  been 
just  around  the  time  that  a  commercial  economy,  and  institutions  like 
coined  money  and  interest-bearing  loans  were  beginning  to  become 
features  of  everyday  life.  The  intellectual  classes  of  the  time  were, 
much  as  they  were  in  Greece  and  China,  grappling  with  the  implica- 
tions. In  their  case,  this  meant  asking:  What  does  it  mean  to  imagine 
our  responsibilities  as  debts?  To  whom  do  we  owe  our  existence? 

It's  significant  that  their  answer  did  not  make  any  mention  either 
of  "society"  or  states  (though  certainly  kings  and  governments  certainly 
existed  in  early  India).  Instead,  they  fixed  on  debts  to  gods,  to  sages,  to 
fathers,  and  to  "men."  It  wouldn't  be  at  all  difficult  to  translate  their 
formulation  into  more  contemporary  language.  We  could  put  it  this 
way.  We  owe  our  existence  above  all: 

•  To  the  universe,  cosmic  forces,  as  we  would  put  it  now,  to  Nature. 
The  ground  of  our  existence.  To  be  repaid  through  ritual:  ritual  be- 
ing an  act  of  respect  and  recognition  to  all  that  beside  which  we  are 

•  To  those  who  have  created  the  knowledge  and  cultural  accom- 
plishments that  we  value  most;  that  give  our  existence  its  form,  its 
meaning,  but  also  its  shape.  Here  we  would  include  not  only  the 
philosophers  and  scientists  who  created  our  intellectual  tradition 
but  everyone  from  William  Shakespeare  to  that  long-since-forgotten 
woman,  somewhere  in  the  Middle  East,  who  created  leavened  bread. 
We  repay  them  by  becoming  learned  ourselves  and  contributing  to 
human  knowledge  and  human  culture. 

•  To  our  parents,  and  their  parents — our  ancestors.  We  repay  them  by 
becoming  ancestors. 

•  To  humanity  as  a  whole.  We  repay  them  by  generosity  to  strang- 
ers, by  maintaining  that  basic  communistic  ground  of  sociality  that 
makes  human  relations,  and  hence  life,  possible. 



Set  out  this  way,  though,  the  argument  begins  to  undermine  its 
very  premise.  These  are  nothing  like  commercial  debts.  After  all,  one 
might  repay  one's  parents  by  having  children,  but  one  is  not  gener- 
ally thought  to  have  repaid  one's  creditors  if  one  lends  the  cash  to 
someone  else.58 

Myself,  I  wonder:  Couldn't  that  really  be  the  point?  Perhaps  what 
the  authors  of  the  Brahmanas  were  really  demonstrating  was  that,  in 
the  final  analysis,  our  relation  with  the  cosmos  is  ultimately  nothing  like 
a  commercial  transaction,  nor  could  it  be.  That  is  because  commercial 
transactions  imply  both  equality  and  separation.  These  examples  are 
all  about  overcoming  separation:  you  are  free  from  your  debt  to  your 
ancestors  when  you  become  an  ancestor;  you  are  free  from  your  debt 
to  the  sages  when  you  become  a  sage,  you  are  free  from  your  debt  to 
humanity  when  you  act  with  humanity.  All  the  more  so  if  one  is  speak- 
ing of  the  universe.  If  you  cannot  bargain  with  the  gods  because  they 
already  have  everything,  then  you  certainly  cannot  bargain  with  the 
universe,  because  the  universe  is  everything — and  that  everything  neces- 
sarily includes  yourself.  One  could  in  fact  interpret  this  list  as  a  subtle 
way  of  saying  that  the  only  way  of  "freeing  oneself"  from  the  debt  was 
not  literally  repaying  debts,  but  rather  showing  that  these  debts  do 
not  exist  because  one  is  not  in  fact  separate  to  begin  with,  and  hence 
that  the  very  notion  of  canceling  the  debt,  and  achieving  a  separate, 
autonomous  existence,  was  ridiculous  from  the  start.  Or  even  that  the 
very  presumption  of  positing  oneself  as  separate  from  humanity  or  the 
cosmos,  so  much  so  that  one  can  enter  into  one-to-one  dealings  with 
it,  is  itself  the  crime  that  can  be  answered  only  by  death.  Our  guilt  is 
not  due  to  the  fact  that  we  cannot  repay  our  debt  to  the  universe.  Our 
guilt  is  our  presumption  in  thinking  of  ourselves  as  being  in  any  sense 
an  equivalent  to  Everything  Else  that  Exists  or  Has  Ever  Existed,  so  as 
to  be  able  to  conceive  of  such  a  debt  in  the  first  place.19 

Or  let  us  look  at  the  other  side  of  the  equation.  Even  if  it  is  pos- 
sible to  imagine  ourselves  as  standing  in  a  position  of  absolute  debt  to 
the  cosmos,  or  to  humanity,  the  next  question  becomes:  Who  exactly 
has  a  right  to  speak  for  the  cosmos,  or  humanity,  to  tell  us  how  that 
debt  must  be  repaid?  If  there's  anything  more  preposterous  than  claim- 
ing to  stand  apart  from  the  entire  universe  so  as  to  enter  into  negotia- 
tions with  it,  it  is  claiming  to  speak  for  the  other  side. 

If  one  were  looking  for  the  ethos  for  an  individualistic  society  such 
as  our  own,  one  way  to  do  it  might  well  be  to  say:  we  all  owe  an  infinite 
debt  to  humanity,  society,  nature,  or  the  cosmos  (however  one  prefers 
to  frame  it),  but  no  one  else  could  possibly  tell  us  how  we  are  to  pay  it. 
This  at  least  would  be  intellectually  consistent.  If  so,  it  would  actually 



be  possible  to  see  almost  all  systems  of  established  authority — religion, 
morality,  politics,  economics,  and  the  criminal-justice  system — as  so 
many  different  fraudulent  ways  to  presume  to  calculate  what  cannot 
be  calculated,  to  claim  the  authority  to  tell  us  how  some  aspect  of  that 
unlimited  debt  ought  to  be  repaid.  Human  freedom  would  then  be  our 
ability  to  decide  for  ourselves  how  we  want  to  do  so. 

No  one,  to  my  knowledge,  has  ever  taken  this  approach.  In- 
stead, theories  of  existential  debt  always  end  up  becoming  wa-ys  of 
justifying — or  laying  claim  to — structures  of  authority.  The  case  of 
the  Hindu  intellectual  tradition  is  telling  here.  The  debt  to  humanity 
appears  only  in  a  few  early  texts,  and  is  quickly  forgotten.  Almost  all 
later  Hindu  commentators  ignore  it  and  instead  put  their  emphasis  on 
a  man's  debt  to  his  father.60 

Primordial-debt  theorists  have  other  fish  to  fry.  They  are  not  really 
interested  in  the  cosmos,  but  actually,  in  "society." 

Let  me  return  again  to  that  word,  "society."  The  reason  that  it 
seems  like  such  a  simple,  self-evident  concept  is  because  we  mostly 
use  it  as  a  synonym  for  "nation."  After  all,  when  Americans  speak  of 
paying  their  debt  to  society,  they  are  not  thinking  of  their  responsibili- 
ties to  people  who  live  in  Sweden.  It's  only  the  modern  state,  with  its 
elaborate  border  controls  and  social  policies,  that  enables  us  to  imagine 
"society"  in  this  way,  as  a  single  bounded  entity.  This  is  why  project- 
ing that  notion  backwards  into  Vedic  or  Medieval  times  will  always  be 
deceptive,  even  though  we  don't  really  have  another  word. 

It  seems  to  me  that  this  is  exactly  what  the  primordial-debt  theo- 
rists are  doing:  projecting  such  a  notion  backwards. 

Really,  the  whole  complex  of  ideas  they  are  talking  about — the 
notion  that  there  is  this  thing  called  society,  that  we  have  a  debt  to  it, 
that  governments  can  speak  for  it,  that  it  can  be  imagined  as  a  sort  of 
secular  god — all  of  these  ideas  emerged  together  around  the  time  of  the 
French  Revolution,  or  in  its  immediate  wake.  In  other  words,  it  was 
born  alongside  the  idea  of  the  modern  nation-state. 

We  can  already  see  them  coming  together  clearly  in  the  work  of 
Auguste  Comte,  in  early  nineteenth-century  France.  Comte,  a  phi- 
losopher and  political  pamphleteer  now  most  famous  for  having  first 
coined  the  term  "sociology,"  went  so  far,  by  the  end  of  his  life,  as 
actually  proposing  a  Religion  of  Society,  which  he  called  Positivism, 



broadly  modeled  on  Medieval  Catholicism,  replete  with  vestments 
where  all  the  buttons  were  on  the  back  (so  they  couldn't  be  put  on 
without  the  help  of  others).  In  his  last  work,  which  he  called  a  "Positiv- 
ist  Catechism,"  he  also  laid  down  the  first  explicit  theory  of  social  debt. 
At  one  point  someone  asks  an  imaginary  Priest  of  Positivism  what  he 
thinks  of  the  notion  of  human  rights.  The  priest  scoffs  at  the  very  idea. 
This  is  nonsense,  he  says,  an  error  born  of  individualism.  Positivism 
understands  only  duties.  After  all: 

We  are  born  under  a  load  of  obligations  of  every  kind,  to  our 
predecessors,  to  our  successors,  to  our  contemporaries.  After 
our  birth  these  obligations  increase  or  accumulate  before  the 
point  where  we  are  capable  of  rendering  anyone  any  service. 
On  what  human  foundation,  then,  could  one  seat  the  idea  of 

While  Comte  doesn't  use  the  word  "debt,"  the  sense  is  clear  enough. 
We  have  already  accumulated  endless  debts  before  we  get  to  the  age  at 
which  we  can  even  think  of  paying  them.  By  that  time,  there's  no  way 
to  calculate  to  whom  we  even  owe  them.  The  only  way  to  redeem  our- 
selves is  to  dedicate  ourselves  to  the  service  of  Humanity  as  a  whole. 

In  his  lifetime,  Comte  was  considered  something  of  a  crackpot,  but 
his  ideas  proved  influential.  His  notion  of  unlimited  obligations  to  so- 
ciety ultimately  crystallized  in  the  notion  of  the  "social  debt,"  a  notion 
taken  up  among  social  reformers  and,  eventually,  socialist  politicians  in 
many  parts  of  Europe  and  abroad.62  "We  are  all  born  as  debtors  to  so- 
ciety": in  France  the  notion  of  a  social  debt  soon  became  something  of 
a  catchphrase,  a  slogan,  and  eventually  a  cliche.63  The  state,  according 
to  this  view,  was  merely  the  administrator  of  an  existential  debt  that 
all  of  us  have  to  the  society  that  created  us,  embodied  not  least  in  the 
fact  that  we  all  continue  to  be  completely  dependent  on  one  another  for 
our  existence,  even  if  we  are  not  completely  aware  of  how. 

These  are  also  the  intellectual  and  political  circles  that  shaped  the 
thought  of  Emile  Durkheim,  the  founder  of  the  discipline  of  sociology 
that  we  know  today,  who  in  a  way  did  Comte  one  better  by  arguing 
that  all  gods  in  all  religions  are  always  already  projections  of  society — 
so  an  explicit  religion  of  society  would  not  even  be  necessary.  All 
religions,  for  Durkheim,  are  simply  ways  of  recognizing  our  mutual 
dependence  on  one  another,  a  dependence  that  affects  us  in  a  million 
ways  that  we  are  never  entirely  aware  of.  "God"  and  "society"  are 
ultimately  the  same. 



The  problem  is  that  for  several  hundred  years  now,  it  has  simply 
been  assumed  that  the  guardian  of  that  debt  we  owe  for  all  of  this,  the 
legitimate  representatives  of  that  amorphous  social  totality  that  has  al- 
lowed us  to  become  individuals,  must  necessarily  be  the  state.  Almost 
all  socialist  or  socialistic  regimes  end  up  appealing  to  some  version  of 
this  argument.  To  take  one  notorious  example,  this  was  how  the  Soviet 
Union  used  to  justify  forbidding  their  citizens  from  emigrating  to  other 
countries.  The  argument  was  always:  The  USSR  created  these  people, 
the  USSR  raised  and  educated  them,  made  them  who  they  are.  What 
right  do  they  have  to  take  the  product  of  our  investment  and  transfer 
it  to  another  country,  as  if  they  didn't  owe  us  anything?  Neither  is  this 
rhetoric  restricted  to  socialist  regimes.  Nationalists  appeal  to  exactly 
the  same  kind  of  arguments — especially  in  times  of  war.  And  all  mod- 
ern governments  are  nationalist  to  some  degree. 

One  might  even  say  that  what  we  really  have,  in  the  idea  of  pri- 
mordial debt,  is  the  ultimate  nationalist  myth.  Once  we  owed  our  lives 
to  the  gods  that  created  us,  paid  interest  in  the  form  of  animal  sacrifice, 
and  ultimately  paid  back  the  principal  with  our  lives.  Now  we  owe  it 
to  the  Nation  that  formed  us,  pay  interest  in  the  form  of  taxes,  and 
when  it  comes  time  to  defend  the  nation  against  its  enemies,  to  offer 
to  pay  it  with  our  lives. 

This  is  a  great  trap  of  the  twentieth  century:  on  one  side  is  the  logic 
of  the  market,  where  we  like  to  imagine  we  all  start  out  as  individuals 
who  don't  owe  each  other  anything.  On  the  other  is  the  logic  of  the 
state,  where  we  all  begin  with  a  debt  we  can  never  truly  pay.  We  are 
constantly  told  that  they  are  opposites,  and  that  between  them  they 
contain  the  only  real  human  possibilities.  But  it's  a  false  dichotomy. 
States  created  markets.  Markets  require  states.  Neither  could  continue 
without  the  other,  at  least,  in  anything  like  the  forms  we  would  rec- 
ognize today. 

Chapter  Four 


We  will  buy  the  poor  for  silver,  the 
needy  for  a  pair  of  sandals. 

— Amos  2:6 

THE  READER  MAY  have  noticed  that  there  is  an  unresolved  debate 
between  those  who  see  money  as  a  commodity  and  those  who  see  it 
as  an  IOU.  Which  one  is  it?  By  now,  the  answer  should  be  obvious: 
it's  both.  Keith  Hart,  probably  the  best-known  current  anthropological 
authority  on  the  subject,  pointed  this  out  many  years  ago.  There  are, 
he  famously  observed,  two  sides  to  any  coin: 

Look  at  a  coin  from  your  pocket.  On  one  side  is  "heads" — the 
symbol  of  the  political  authority  which  minted  the  coin;  on  the 
other  side  is  "tails" — the  precise  specification  of  the  amount 
the  coin  is  worth  as  payment  in  exchange.  One  side  reminds  us 
that  states  underwrite  currencies  and  the  money  is  originally  a 
relation  between  persons  in  society,  a  token  perhaps.  The  other 
reveals  the  coin  as  a  thing,  capable  of  entering  into  definite 
relations  with  other  things.1 

Clearly,  money  was  not  invented  to  overcome  the  inconveniences 
of  barter  between  neighbors — since  neighbors  would  have  no  reason  to 
engage  in  barter  in  the  first  place.  Still,  a  system  of  pure  credit  money 
would  have  serious  inconveniences  as  well.  Credit  money  is  based  on 
trust,  and  in  competitive  markets,  trust  itself  becomes  a  scarce  com- 
modity. This  is  particularly  true  of  dealings  between  strangers.  Within 
the  Roman  empire,  a  silver  coin  stamped  with  the  image  of  Tiberius 
might  have  circulated  at  a  value  considerably  higher  than  the  value  of 
the  silver  it  contained.  Ancient  coins  invariably  circulated  at  a  value 
higher  than  their  metal  content.2  This  was  largely  because  Tiberius's 
government  was  willing  to  accept  them  at  face  value.  However,  the 



Persian  government  probably  wasn't,  and  the  Mauryan  and  Chinese 
governments  certainly  weren't.  Very  large  numbers  of  Roman  gold  and 
silver  coins  did  end  up  in  India  and  even  China;  this  is  presumably  the 
main  reason  that  they  were  made  of  gold  and  silver  to  begin  with. 

What's  true  for  a  vast  empire  like  Rome  or  China  is  obviously 
all  the  more  true  for  a  Sumerian  or  Greek  city-state,  let  alone  anyone 
operating  within  the  kind  of  broken  checkerboard  of  kingdoms,  towns, 
and  tiny  principalities  that  prevailed  in  most  of  Medieval  Europe  or 
India.  As  I've  pointed  out,  often  what  was  inside  and  what  was  out- 
side were  not  especially  clear.  Within  a  community — a  town,  a  city, 
a  guild  or  religious  society — pretty  much  anything  could  function  as 
money,  provided  everyone  knew  there  was  someone  willing  to  accept 
it  to  cancel  out  a  debt.  To  offer  one  particularly  striking  example,  in 
certain  cities  in  nineteenth-century  Siam,  small  change  consisted  en- 
tirely of  porcelain  Chinese  gaming  counters — basically,  the  equivalent 
of  poker  chips — issued  by  local  casinos.  If  one  of  these  casinos  went 
out  of  business  or  lost  its  license,  its  owners  would  have  to  send  a  crier 
through  the  streets  banging  a  gong  and  announcing  that  anyone  hold- 
ing such  chits  had  three  days  to  redeem  them.3  For  major  transactions, 
of  course,  currency  that  was  also  acceptable  outside  the  community 
(usually  silver  or  gold  again)  was  ordinarily  employed. 

In  a  similar  way,  English  shops,  for  many  centuries,  would  issue 
their  own  wood  or  lead  or  leather  token  money.  The  practice  was  often 
technically  illegal,  but  it  continued  until  relatively  recent  times.  Here  is 
an  example  from  the  seventeenth  century,  by  a  certain  Henry,  who  had 
a  store  at  Stony  Stratford,  Buckinghamshire: 

This  is  clearly  a  case  of  the  same  principle:  Henry  would  provide 
small  change  in  the  form  of  IOUs  redeemable  at  his  own  store.  As  such, 
they  might  circulate  broadly,  at  least  among  anyone  who  did  regular 
business  at  that  shop.  But  they  were  unlikely  to  travel  very  far  from 
Stony  Stratford — most  tokens,  in  fact,  never  circulated  more  than  a  few 
blocks  in  any  direction.  For  larger  transactions,  everyone,  including 
Henry,  expected  money  in  a  form  that  would  be  acceptable  anywhere, 
including  in  Italy  or  France.4 



Throughout  most  of  history,  even  where  we  do  find  elaborate  mar- 
kets, we  also  find  a  complex  jumble  of  different  sorts  of  currency. 
Some  of  these  may  have  originally  emerged  from  barter  between  for- 
eigners: the  cacao  money  of  Mesoamerica  or  salt  money  of  Ethiopia 
are  frequently  cited  examples.5  Others  arose  from  credit  systems,  or 
from  arguments  over  what  sort  of  goods  should  be  acceptable  to  pay 
taxes  or  other  debts.  Such  questions  were  often  matters  of  endless 
contestation.  One  could  often  learn  a  lot  about  the  balance  of  political 
forces  in  a  given  time  and  place  by  what  sorts  of  things  were  accept- 
able as  currency.  For  instance:  in  much  the  same  way  that  colonial 
Virginia  planters  managed  to  pass  a  law  obliging  shopkeepers  to  ac- 
cept their  tobacco  as  currency,  medieval  Pomeranian  peasants  appear 
to  have  at  certain  points  convinced  their  rulers  to  make  taxes,  fees, 
and  customs  duties,  which  were  registered  in  Roman  currency,  actually 
payable  in  wine,  cheese,  peppers,  chickens,  eggs,  and  even  herring — 
much  to  the  annoyance  of  traveling  merchants,  who  therefore  had 
to  either  carry  such  things  around  in  order  to  pay  the  tolls  or  buy 
them  locally  at  prices  that  would  have  been  more  advantageous  to 
their  suppliers  for  that  very  reason.6  This  was  in  an  area  with  a  free 
peasantry,  rather  than  serfs.  They  were  in  a  relatively  strong  political 
position.  In  other  times  and  places,  the  interests  of  lords  and  merchants 
prevailed  instead. 

Thus  money  is  almost  always  something  hovering  between  a  com- 
modity and  a  debt-token.  This  is  probably  why  coins — pieces  of  silver 
or  gold  that  are  already  valuable  commodities  in  themselves,  but  that, 
being  stamped  with  the  emblem  of  a  local  political  authority,  became 
even  more  valuable — still  sit  in  our  heads  as  the  quintessential  form 
of  money.  They  most  perfectly  straddle  the  divide  that  defines  what 
money  is  in  the  first  place.  What's  more,  the  relation  between  the  two 
was  a  matter  of  constant  political  contestation. 

In  other  words,  the  battle  between  state  and  market,  between  gov- 
ernments and  merchants  is  not  inherent  to  the  human  condition. 

I  I  I  I  I 

Our  two  origin  stories — the  myth  of  barter  and  the  myth  of  primordial 
debt — may  appear  to  be  about  as  far  apart  as  they  could  be,  but  in 
their  own  way,  they  are  also  two  sides  of  the  same  coin.  One  assumes 
the  other.  It's  only  once  we  can  imagine  human  life  as  a  series  of  com- 
mercial transactions  that  we're  capable  of  seeing  our  relation  to  the 
universe  in  terms  of  debt. 



To  illustrate,  let  me  call  a  perhaps  surprising  witness,  Friedrich 
Nietzsche,  a  man  able  to  see  with  uncommon  clarity  what  happens 
when  you  try  to  imagine  the  world  in  commercial  terms. 

Nietzsche's  On  the  Genealogy  of  Morals  appeared  in  1887.  In  it,  he 
begins  with  an  argument  that  might  well  have  been  taken  directly  from 
Adam  Smith — but  he  takes  it  a  step  further  than  Smith  ever  dared  to, 
insisting  that  not  just  barter,  but  buying  and  selling  itself,  precede  any 
other  form  of  human  relationship.  The  feeling  of  personal  obligation, 
he  observes, 

has  its  origin  in  the  oldest  and  most  primitive  personal  rela- 
tionship there  is,  in  the  relationship  between  seller  and  buyer, 
creditor  and  debtor.  Here  for  the  first  time  one  person  moved 
up  against  another  person,  here  an  individual  measured  himself 
against  another  individual.  We  have  found  no  civilization  still 
at  such  a  low  level  that  something  of  this  relationship  is  not 
already  perceptible.  To  set  prices,  to  measure  values,  to  think 
up  equivalencies,  to  exchange  things — that  preoccupied  man's 
very  first  thinking  to  such  a  degree  that  in  a  certain  sense 
it's  what  thinking  itself  is.  Here  the  oldest  form  of  astuteness 
was  bred;  here,  too,  we  can  assume  are  the  first  beginnings  of 
man's  pride,  his  feeling  of  pre-eminence  in  relation  to  other 
animals.  Perhaps  our  word  "man"  (manas)  continues  to  ex- 
press directly  something  of  this  feeling  of  the  self:  the  human 
being  describes  himself  as  a  being  which  assesses  values,  which 
values  and  measures,  as  the  "inherently  calculating  animal." 
Selling  and  buying,  together  with  their  psychological  attributes, 
are  even  older  than  the  beginnings  of  any  form  of  social  orga- 
nizations and  groupings;  out  of  the  most  rudimentary  form  of 
personal  legal  rights  the  budding  feeling  of  exchange,  contract, 
guilt,  law,  duty,  and  compensation  was  instead  first  transferred 
to  the  crudest  and  earliest  social  structures  (in  their  relation- 
ships with  similar  social  structures),  along  with  the  habit  of 
comparing  power  with  power,  of  measuring,  of  calculating.7 

Smith,  too,  we  will  remember,  saw  the  origins  of  language — and 
hence  of  human  thought — as  lying  in  our  propensity  to  "exchange  one 
thing  for  another,"  in  which  he  also  saw  the  origins  of  the  market.8  The 
urge  to  trade,  to  compare  values,  is  the  very  thing  that  makes  us  intel- 
ligent beings,  and  different  from  other  animals.  Society  comes  later — 
which  means  our  ideas  about  responsibilities  to  other  people  first  take 
shape  in  strictly  commercial  terms. 



Unlike  with  Smith,  however,  it  never  occurred  to  Nietzsche  that 
you  could  have  a  world  where  all  such  transactions  immediately  cancel 
out.  Any  system  of  commercial  accounting,  he  assumed,  will  produce 
creditors  and  debtors.  In  fact,  he  believed  that  it  was  from  this  very 
fact  that  human  morality  emerged.  Note,  he  says,  how  the  German 
word  schuld  means  both  "debt"  and  "guilt."  At  first,  to  be  in  debt 
was  simply  to  be  guilty,  and  creditors  delighted  in  punishing  debtors 
unable  to  repay  their  loans  by  inflicting  "all  sorts  of  humiliation  and 
torture  on  the  body  of  the  debtor,  for  instance,  cutting  as  much  flesh 
off  as  seemed  appropriate  for  the  debt."9  In  fact,  Nietzsche  went  so  far 
as  to  insist  that  those  original  barbarian  law  codes  that  tabulated  so 
much  for  a  ruined  eye,  so  much  for  a  severed  finger,  were  not  originally 
meant  to  fix  rates  of  monetary  compensation  for  the  loss  of  eyes  and 
fingers,  but  to  establish  how  much  of  the  debtor's  body  creditors  were 
allowed  to  take!  Needless  to  say,  he  doesn't  provide  a  scintilla  of  evi- 
dence for  this  (none  exists).10  But  to  ask  for  evidence  would  be  to  miss 
the  point.  We  are  dealing  here  not  with  a  real  historical  argument  but 
with  a  purely  imaginative  exercise. 

When  humans  did  begin  to  form  communities,  Nietzsche  contin- 
ues, they  necessarily  began  to  imagine  their  relationship  to  the  com- 
munity in  these  terms.  The  tribe  provides  them  with  peace  and  security. 
They  are  therefore  in  its  debt.  Obeying  its  laws  is  a  way  of  paying  it 
back  ("paying  your  debt  to  society"  again).  But  this  debt,  he  says,  is 
also  paid — here  too — in  sacrifice: 

Within  the  original  tribal  cooperatives — we're  talking  about 
primeval  times — the  living  generation  always  acknowledged  a 
legal  obligation  to  the  previous  generations,  and  especially  to 
the  earliest  one  which  had  founded  the  tribe  [  .  .  .  ]  Here  the 
reigning  conviction  is  that  the  tribe  only  exists  at  all  only  be- 
cause of  the  sacrifices  and  achievements  of  its  ancestors — and 
that  people  have  to  pay  them  back  with  sacrifices  and  achieve- 
ments. In  this  people  recognize  a  debt  which  keeps  steadily 
growing  because  these  ancestors  in  their  continuing  existence 
as  powerful  spirits  do  not  stop  giving  the  tribe  new  advantages 
and  lending  them  their  power.  Do  they  do  this  for  free?  But 
there  is  no  "for  free"  for  those  raw  and  "spiritually  destitute" 
ages.  What  can  people  give  back  to  them?  Sacrifices  (at  first  as 
nourishment  understood  very  crudely),  festivals,  chapels,  signs 
of  honor,  above  all,  obedience — for  all  customs,  as  work  of 
one's  ancestors,  are  also  their  statutes  and  commands.  Do  peo- 
ple ever  give  them  enough?  This  suspicion  remains  and  grows.11 



In  other  words,  for  Nietzsche,  starting  from  Adam  Smith's  as- 
sumptions about  human  nature  means  we  must  necessarily  end  up  with 
something  very  much  along  the  lines  of  primordial-debt  theory.  On  the 
one  hand,  it  is  because  of  our  feeling  of  debt  to  the  ancestors  that  we 
obey  the  ancestral  laws:  this  is  why  we  feel  that  the  community  has  the 
right  to  react  "like  an  angry  creditor"  and  punish  us  for  our  transgres- 
sions if  we  break  them.  In  a  larger  sense,  we  develop  a  creeping  feeling 
that  we  could  never  really  pay  back  the  ancestors,  that  no  sacrifice  (not 
even  the  sacrifice  of  our  first-born)  will  ever  truly  redeem  us.  We  are 
terrified  of  the  ancestors,  and  the  stronger  and  more  powerful  a  com- 
munity becomes,  the  more  powerful  they  seem  to  be,  until  finally,  "the 
ancestor  is  necessarily  transfigured  into  a  god."  As  communities  grow 
into  kingdoms  and  kingdoms  into  universal  empires,  the  gods  them- 
selves come  to  seem  more  universal,  they  take  on  grander,  more  cosmic 
pretentions,  ruling  the  heavens,  casting  thunderbolts — culminating  in 
the  Christian  god,  who,  as  the  maximal  deity,  necessarily  "brought 
about  the  maximum  feeling  of  indebtedness  on  earth."  Even  our  ances- 
tor Adam  is  no  longer  figured  as  a  creditor,  but  as  a  transgressor,  and 
therefore  a  debtor,  who  passes  on  to  us  his  burden  of  Original  Sin: 

Finally,  with  the  impossibility  of  discharging  the  debt,  people 
also  come  up  with  the  notion  that  it  is  impossible  to  remove 
the  penance,  the  idea  that  it  cannot  be  paid  off  ("eternal  pun- 
ishment") .  .  .  until  all  of  a  sudden  we  confront  the  paradoxi- 
cal and  horrifying  expedient  with  which  a  martyred  humanity 
found  temporary  relief,  that  stroke  of  genius  of  Christianity: 
God  sacrificing  himself  for  the  guilt  of  human  beings,  God  pay- 
ing himself  back  with  himself,  God  as  the  only  one  who  can  re- 
deem man  from  what  for  human  beings  has  become  impossible 
to  redeem — the  creditor  sacrificing  himself  for  the  debtor,  out 
of  love  (can  people  believe  that?),  out  of  love  for  his  debtor!12 

It  all  makes  perfect  sense  if  you  start  from  Nietzsche's  initial  prem- 
ise. The  problem  is  that  the  premise  is  insane. 

There  is  also  every  reason  to  believe  that  Nietzsche  knew  the  prem- 
ise was  insane;  in  fact,  that  this  was  the  entire  point.  What  Nietzsche 
is  doing  here  is  starting  out  from  the  standard,  common-sense  assump- 
tions about  the  nature  of  human  beings  prevalent  in  his  day  (and  to  a 
large  extent,  still  prevalent) — that  we  are  rational  calculating  machines, 
that  commercial  self-interest  comes  before  society,  that  "society"  itself 
is  just  a  way  of  putting  a  kind  of  temporary  lid  on  the  resulting  con- 
flict. That  is,  he  is  starting  out  from  ordinary  bourgeois  assumptions 



and  driving  them  to  a  place  where  they  can  only  shock  a  bourgeois 

It's  a  worthy  game  and  no  one  has  ever  played  it  better;  but  it's 
a  game  played  entirely  within  the  boundaries  of  bourgeois  thought.  It 
has  nothing  to  say  to  anything  that  lies  beyond  that.  The  best  response 
to  anyone  who  wants  to  take  seriously  Nietzsche's  fantasies  about  sav- 
age hunters  chopping  pieces  off  each  other's  bodies  for  failure  to  remit 
are  the  words  of  an  actual  hunter-gatherer — an  Inuit  from  Greenland 
made  famous  in  the  Danish  writer  Peter  Freuchen's  Book  of  the  Es- 
kimo. Freuchen  tells  how  one  day,  after  coming  home  hungry  from  an 
unsuccessful  walrus-hunting  expedition,  he  found  one  of  the  successful 
hunters  dropping  off  several  hundred  pounds  of  meat.  He  thanked  him 
profusely.  The  man  objected  indignantly: 

"Up  in  our  country  we  are  human!"  said  the  hunter.  "And 
since  we  are  human  we  help  each  other.  We  don't  like  to  hear 
anybody  say  thanks  for  that.  What  I  get  today  you  may  get 
tomorrow.  Up  here  we  say  that  by  gifts  one  makes  slaves  and 
by  whips  one  makes  dogs."'3 

The  last  line  is  something  of  an  anthropological  classic,  and  simi- 
lar statements  about  the  refusal  to  calculate  credits  and  debits  can 
be  found  through  the  anthropological  literature  on  egalitarian  hunt- 
ing societies.  Rather  than  seeing  himself  as  human  because  he  could 
make  economic  calculations,  the  hunter  insisted  that  being  truly  hu- 
man meant  refusing  to  make  such  calculations,  refusing  to  measure  or 
remember  who  had  given  what  to  whom,  for  the  precise  reason  that 
doing  so  would  inevitably  create  a  world  where  we  began  "comparing 
power  with  power,  measuring,  calculating"  and  reducing  each  other  to 
slaves  or  dogs  through  debt. 

It's  not  that  he,  like  untold  millions  of  similar  egalitarian  spirits 
throughout  history,  was  unaware  that  humans  have  a  propensity  to 
calculate.  If  he  wasn't  aware  of  it,  he  could  not  have  said  what  he 
did.  Of  course  we  have  a  propensity  to  calculate.  We  have  all  sorts  of 
propensities.  In  any  real-life  situation,  we  have  propensities  that  drive 
us  in  several  different  contradictory  directions  simultaneously.  No  one 
is  more  real  than  any  other.  The  real  question  is  which  we  take  as 
the  foundation  of  our  humanity,  and  therefore,  make  the  basis  of  our 
civilization.  If  Nietzsche's  analysis  of  debt  is  helpful  to  us,  then,  it  is 
because  it  reveals  that  when  we  start  from  the  assumption  that  human 
thought  is  essentially  a  matter  of  commercial  calculation,  that  buying 
and  selling  are  the  basis  of  human  society — then,  yes,  once  we  begin 



to  think  about  our  relationship  with  the  cosmos,  we  will  necessarily 
conceive  of  it  in  terms  of  debt. 

I  do  think  Nietzsche  helps  us  in  another  way  as  well:  to  understand  the 
concept  of  redemption.  Niezsche's  account  of  "primeval  times"  might 
be  absurd,  but  his  description  of  Christianity — of  how  a  sense  of  debt 
is  transformed  into  an  abiding  sense  of  guilt,  and  guilt  to  self-loathing, 
and  self-loathing  to  self-torture — all  of  this  does  ring  very  true. 

Why,  for  instance,  do  we  refer  to  Christ  as  the  "redeemer"?  The 
primary  meaning  of  "redemption"  is  to  buy  something  back,  or  to 
recover  something  that  had  been  given  up  in  security  for  a  loan;  to  ac- 
quire something  by  paying  off  a  debt.  It  is  rather  striking  to  think  that 
the  very  core  of  the  Christian  message,  salvation  itself,  the  sacrifice  of 
God's  own  son  to  rescue  humanity  from  eternal  damnation,  should  be 
framed  in  the  language  of  a  financial  transaction. 

Nietzsche  might  have  been  starting  from  the  same  assumptions  as 
Adam  Smith,  but  clearly  the  early  Christians  weren't.  The  roots  of  this 
thinking  lie  deeper  than  Smith's  with  his  nation  of  shopkeepers.  The 
authors  of  the  Brahmanas  were  not  alone  in  borrowing  the  language 
of  the  marketplace  as  a  way  of  thinking  about  the  human  condition. 
Indeed,  to  one  degree  or  another,  all  the  major  world  religions  do  this. 

The  reason  is  that  all  of  them — from  Zoroastrianism  to  Islam — 
arose  amidst  intense  arguments  about  the  role  of  money  and  the  mar- 
ket in  human  life,  and  particularly  about  what  these  institutions  meant 
for  fundamental  questions  of  what  human  beings  owed  to  one  another. 
The  question  of  debt,  and  arguments  about  debt,  ran  through  every 
aspect  of  the  political  life  of  the  time.  These  arguments  were  set  amidst 
revolts,  petitions,  reformist  movements.  Some  such  movements  gained 
allies  in  the  temples  and  palaces.  Others  were  brutally  suppressed. 
Most  of  the  terms,  slogans,  and  specific  issues  being  debated,  though, 
have  been  lost  to  history.  We  just  don't  know  what  a  political  debate 
in  a  Syrian  tavern  in  750  bc  was  likely  to  be  about.  As  a  result,  we  have 
spent  thousands  of  years  contemplating  sacred  texts  full  of  political 
allusions  that  would  have  been  instantly  recognizable  to  any  reader  at 
the  time  when  they  were  written,  but  whose  meaning  we  now  can  only 
guess  at.14 

One  of  the  unusual  things  about  the  Bible  is  that  it  preserves  some 
bits  of  this  larger  context.  To  return  to  the  notion  of  redemption: 
the  Hebrew  words  padah  and  goal,  both  translated  as  "redemption," 
could  be  used  for  buying  back  anything  one  had  sold  to  someone  else, 



particularly  the  recovery  of  ancestral  land,  or  to  recovering  some  ob- 
ject held  by  creditors  in  way  of  a  pledge.15  The  example  foremost  in 
the  minds  of  prophets  and  theologians  seems  to  have  been  the  last:  the 
redemption  of  pledges,  and  especially,  of  family  members  held  as  debt- 
pawns.  It  would  seem  that  the  economy  of  the  Hebrew  kingdoms,  by 
the  time  of  the  prophets,  was  already  beginning  to  develop  the  same 
kind  of  debt  crises  that  had  long  been  common  in  Mesopotamia:  espe- 
cially in  years  of  bad  harvests,  the  poor  became  indebted  to  rich  neigh- 
bors or  to  wealthy  moneylenders  in  the  towns,  they  would  begin  to 
lose  title  to  their  fields  and  to  become  tenants  on  what  had  been  their 
own  land,  and  their  sons  and  daughters  would  be  removed  to  serve  as 
servants  in  their  creditors'  households,  or  even  sold  abroad  as  slaves.16 
The  earlier  prophets  contain  allusions  to  such  crises,  but  the  book  of 
Nehemiah,  written  in  Persian  times,  is  the  most  explicit:17 

Some  also  there  were  that  said,  "We  have  mortgaged  our  lands, 
vineyards,  and  houses,  that  we  might  buy  corn,  because  of  the 

There  were  also  those  that  said,  "We  have  borrowed  money 
for  the  king's  tribute,  and  that  upon  our  lands  and  vineyards. 

"Yet  now  our  flesh  is  as  the  flesh  of  our  brethren,  our  chil- 
dren as  their  children:  and,  lo,  we  bring  into  bondage  our  sons 
and  our  daughters  to  be  servants,  and  some  of  our  daughters 
are  brought  unto  bondage  already:  neither  is  it  in  our  power 
to  redeem  them;  for  other  men  have  our  lands  and  vineyards." 

And  I  was  very  angry  when  I  heard  their  cry  and  these 

Then  I  consulted  with  myself,  and  I  rebuked  the  nobles,  and 
the  rulers,  and  said  unto  them,  "Ye  exact  usury,  every  one  of 
his  brother."  And  I  set  a  great  assembly  against  them.18 

Nehemiah  was  a  Jew  born  in  Babylon,  a  former  cup-bearer  to  the 
Persian  emperor.  In  444  bc,  he  managed  to  talk  the  Great  King  into 
appointing  him  governor  of  his  native  Judaea.  He  also  received  per- 
mission to  rebuild  the  Temple  in  Jerusalem  that  had  been  destroyed 
by  Nebuchadnezzar  more  than  two  centuries  earlier.  In  the  course  of 
rebuilding,  sacred  texts  were  recovered  and  restored;  in  a  sense,  this 
was  the  moment  of  the  creation  of  what  we  now  consider  Judaism. 

The  problem  was  that  Nehemiah  quickly  found  himself  confronted 
with  a  social  crisis.  All  around  him,  impoverished  peasants  were  un- 
able to  pay  their  taxes;  creditors  were  carrying  off  the  children  of  the 
poor.  His  first  response  was  to  issue  a  classic  Babylonian-style  "clean 



slate"  edict — having  himself  been  born  in  Babylon,  he  was  clearly  fa- 
miliar with  the  general  principle.  All  non-commercial  debts  were  to  be 
forgiven.  Maximum  interest  rates  were  set.  At  the  same  time,  though, 
Nehemiah  managed  to  locate,  revise,  and  reissue  much  older  Jewish 
laws,  now  preserved  in  Exodus,  Deuteronomy,  and  Leviticus,  which 
in  certain  ways  went  even  further,  by  institutionalizing  the  principle.19 
The  most  famous  of  these  is  the  Law  of  Jubilee:  a  law  that  stipulated 
that  all  debts  would  be  automatically  cancelled  "in  the  Sabbath  year" 
(that  is,  after  seven  years  had  passed),  and  that  all  who  languished  in 
bondage  owing  to  such  debts  would  be  released.20 

"Freedom,"  in  the  Bible,  as  in  Mesopotamia,  came  to  refer  above 
all  to  release  from  the  effects  of  debt.  Over  time,  the  history  of  the  Jew- 
ish people  itself  came  to  be  interpreted  in  this  light:  the  liberation  from 
bondage  in  Egypt  was  God's  first,  paradigmatic  act  of  redemption;  the 
historical  tribulations  of  the  Jews  (defeat,  conquest,  exile)  were  seen 
as  misfortunes  that  would  eventually  lead  to  a  final  redemption  with 
the  coming  of  the  Messiah — though  this  could  only  be  accomplished, 
prophets  such  as  Jeremiah  warned  them,  after  the  Jewish  people  truly 
repented  of  their  sins  (carrying  each  other  off  into  bondage,  whoring 
after  false  gods,  the  violation  of  commandments).21  In  this  light,  the 
adoption  of  the  term  by  Christians  is  hardly  surprising.  Redemption 
was  a  release  from  one's  burden  of  sin  and  guilt,  and  the  end  of  history 
would  be  that  moment  when  all  slates  are  wiped  clean  and  all  debts 
finally  lifted  when  a  great  blast  from  angelic  trumpets  will  announce 
the  final  Jubilee. 

If  so,  "redemption"  is  no  longer  about  buying  something  back. 
It's  really  more  a  matter  of  destroying  the  entire  system  of  account- 
ing. In  many  Middle  Eastern  cities,  this  was  literally  true:  one  of  the 
common  acts  during  debt  cancelation  was  the  ceremonial  destruction 
of  the  tablets  on  which  financial  records  had  been  kept,  an  act  to  be 
repeated,  much  less  officially,  in  just  about  every  major  peasant  revolt 
in  history.22 

This  leads  to  another  problem:  What  is  possible  in  the  meantime, 
before  that  final  redemption  comes?  In  one  of  his  more  disturbing 
parables,  the  Parable  of  the  Unforgiving  Servant,  Jesus  seemed  to  be 
explicitly  playing  with  the  problem: 

Therefore,  the  kingdom  of  heaven  is  like  a  king  who  wanted  to 
settle  accounts  with  his  servants.  As  he  began  the  settlement,  a 
man  who  owed  him  ten  thousand  talents  was  brought  to  him. 
Since  he  was  not  able  to  pay,  the  master  ordered  that  he  and 



his  wife  and  his  children  and  all  that  he  had  be  sold  to  repay 
the  debt. 

The  servant  fell  on  his  knees  before  him.  "Be  patient  with 
me,"  he  begged,  "and  I  will  pay  back  everything."  The  servant's 
master  took  pity  on  him,  canceled  the  debt,  and  let  him  go. 

But  when  that  servant  went  out,  he  found  one  of  his  fellow 
servants  who  owed  him  a  hundred  denarii.  He  grabbed  him 
and  began  to  choke  him.  "Pay  back  what  you  owe  me!"  he 

His  fellow  servant  fell  to  his  knees  and  begged  him,  "Be 
patient  with  me,  and  I  will  pay  you  back." 

But  he  refused.  Instead,  he  went  off  and  had  the  man  thrown 
into  prison  until  he  could  pay  the  debt.  When  the  other  ser- 
vants saw  what  had  happened,  they  were  greatly  distressed  and 
went  and  told  their  master  everything  that  had  happened. 

Then  the  master  called  the  servant  in.  "You  wicked  ser- 
vant," he  said,  "I  canceled  all  that  debt  of  yours  because  you 
begged  me  to.  Shouldn't  you  have  had  mercy  on  your  fellow 
servant  just  as  I  had  on  you?"  In  anger  his  master  turned  him 
over  to  the  jailers  to  be  tortured,  until  he  should  pay  back  all 
he  owed.23 

This  is  quite  an  extraordinary  text.  On  one  level  it's  a  joke;  in  oth- 
ers, it  could  hardly  be  more  serious. 

We  begin  with  the  king  wishing  to  "settle  accounts"  with  his  ser- 
vants. The  premise  is  absurd.  Kings,  like  gods,  can't  really  enter  into 
relations  of  exchange  with  their  subjects,  since  no  parity  is  possible. 
And  this  is  a  king  who  clearly  is  God.  Certainly  there  can  be  no  final 
settling  of  accounts. 

So  at  best  we  are  dealing  with  an  act  of  whimsy  on  the  king's  part. 
The  absurdity  of  the  premise  is  hammered  home  by  the  sum  the  first 
man  brought  before  him  is  said  to  owe.  In  ancient  Judaea,  to  say  some- 
one owes  a  creditor  "ten  thousand  talents"  would  be  like  now  saying 
someone  owes  "a  hundred  billion  dollars."  The  number  is  a  joke,  too; 
it  simply  stands  in  for  "a  sum  no  human  being  could  ever,  conceivably, 

Faced  with  infinite,  existential  debt,  the  servant  can  only  tell  obvi- 
ous lies:  "a  hundred  billion?  Sure,  I'm  good  for  it!  Just  give  me  a  little 
more  time."  Then,  suddenly,  apparently  just  as  arbitrarily,  the  Lord 
forgives  him. 

Yet,  it  turns  out,  the  amnesty  has  a  condition  he  is  not  aware  of.  It 
is  incumbent  on  his  being  willing  to  act  in  an  analogous  way  to  other 



humans — in  this  particular  case,  another  servant  who  owes  him  (to 
translate  again  into  contemporary  terms),  maybe  a  thousand  bucks. 
Failing  the  test,  the  human  is  cast  into  hell  for  all  eternity,  or  "until  he 
should  pay  back  all  he  owed,"  which  in  this  case  comes  down  to  the 
same  thing. 

The  parable  has  long  been  a  challenge  to  theologians.  It's  normally 
interpreted  as  a  comment  on  the  endless  bounty  of  God's  grace  and 
how  little  He  demands  of  us  in  comparison — and  thus,  by  implication, 
as  a  way  of  suggesting  that  torturing  us  in  hell  for  all  eternity  is  not 
as  unreasonable  as  it  might  seem.  Certainly,  the  unforgiving  servant  is 
a  genuinely  odious  character.  Still,  what  is  even  more  striking  to  me 
is  the  tacit  suggestion  that  forgiveness,  in  this  world,  is  ultimately  im- 
possible. Christians  practically  say  as  much  every  time  they  recite  the 
Lord's  Prayer,  and  ask  God  to  "forgive  us  our  debts,  as  we  also  forgive 
our  debtors."25  It  repeats  the  story  of  the  parable  almost  exactly,  and 
the  implications  are  similarly  dire.  After  all,  most  Christians  reciting 
the  prayer  are  aware  that  they  do  not  generally  forgive  their  debtors. 
Why  then  should  God  forgive  them  their  sins?26 

What's  more,  there  is  the  lingering  suggestion  that  we  really 
couldn't  live  up  to  those  standards,  even  if  we  tried.  One  of  the  things 
that  makes  the  Jesus  of  the  New  Testament  such  a  tantalizing  character 
is  that  it's  never  clear  what  he's  telling  us.  Everything  can  be  read  two 
ways.  When  he  calls  on  his  followers  to  forgive  all  debts,  refuse  to  cast 
the  first  stone,  turn  the  other  cheek,  love  their  enemies,  to  hand  over 
their  possessions  to  the  poor — is  he  really  expecting  them  to  do  this? 
Or  are  such  demands  just  a  way  of  throwing  in  their  faces  that,  since 
we  are  clearly  not  prepared  to  act  this  way,  we  are  all  sinners  whose 
salvation  can  only  come  in  another  world — a  position  that  can  be  (and 
has  been)  used  to  justify  almost  anything?  This  is  a  vision  of  human  life 
as  inherently  corrupt,  but  it  also  frames  even  spiritual  affairs  in  com- 
mercial terms:  with  calculations  of  sin,  penance,  and  absolution,  the 
Devil  and  St.  Peter  with  their  rival  ledger  books,  usually  accompanied 
by  the  creeping  feeling  that  it's  all  a  charade  because  the  very  fact  that 
we  are  reduced  to  playing  such  a  game  of  tabulating  sins  reveals  us  to 
be  fundamentally  unworthy  of  forgiveness. 

World  religions,  as  we  shall  see,  are  full  of  this  kind  of  ambiva- 
lence. On  the  one  hand  they  are  outcries  against  the  market;  on  the 
other,  they  tend  to  frame  their  objections  in  commercial  terms — as  if 
to  argue  that  turning  human  life  into  a  series  of  transactions  is  not  a 
very  good  deal.  What  I  think  even  these  few  examples  reveal,  though, 
is  how  much  is  being  papered  over  in  the  conventional  accounts  of  the 
origins  and  history  of  money.  There  is  something  almost  touchingly 



naive  in  the  stories  about  neighbors  swapping  potatoes  for  an  extra 
pair  of  shoes.  When  the  ancients  thought  about  money,  friendly  swaps 
were  hardly  the  first  thing  that  came  to  mind. 

True,  some  might  have  thought  about  their  tab  at  the  local  ale- 
house, or,  if  they  were  a  merchant  or  administrator,  of  storehouses, 
account  books,  exotic  imported  delights.  For  most,  though,  what  was 
likely  to  come  to  mind  was  the  selling  of  slaves  and  ransoming  of  pris- 
oners, corrupt  tax-farmers  and  the  depredations  of  conquering  armies, 
mortgages  and  interest,  theft  and  extortion,  revenge  and  punishment, 
and,  above  all,  the  tension  between  the  need  for  money  to  create  fami- 
lies, to  acquire  a  bride  so  as  to  have  children,  and  use  of  that  same 
money  to  destroy  families — to  create  debts  that  lead  to  the  same  wife 
and  children  being  taken  away.  "Some  of  our  daughters  are  brought 
unto  bondage  already:  neither  is  it  in  our  power  to  redeem  them."  One 
can  only  imagine  what  those  words  meant,  emotionally,  to  a  father  in 
a  patriarchal  society  in  which  a  man's  ability  to  protect  the  honor  of 
his  family  was  everything.  Yet  this  is  what  money  meant  to  the  ma- 
jority of  people  for  most  of  human  history:  the  terrifying  prospect  of 
one's  sons  and  daughters  being  carried  off  to  the  homes  of  repulsive 
strangers  to  clean  their  pots  and  provide  the  occasional  sexual  services, 
to  be  subject  to  every  conceivable  form  of  violence  and  abuse,  pos- 
sibly for  years,  conceivably  forever,  as  their  parents  waited,  helpless, 
avoiding  eye  contact  with  their  neighbors,  who  knew  exactly  what  was 
happening  to  those  they  were  supposed  to  have  been  able  to  protect.27 
Clearly  this  was  the  worst  thing  that  could  happen  to  anyone — which 
is  why,  in  the  parable,  it  could  be  treated  as  interchangeable  with  be- 
ing "turned  over  to  the  jailors  to  be  tortured"  for  life.  And  that's  just 
from  the  perspective  of  the  father.  One  can  only  imagine  how  it  might 
have  felt  to  be  the  daughter.  Yet,  over  the  course  of  human  history, 
untold  millions  of  daughters  have  known  (and  in  fact  many  still  know) 
exactly  what  it's  like. 

One  might  object  that  this  was  just  assumed  to  be  in  the  nature 
of  things:  like  the  imposition  of  tribute  on  conquered  populations,  it 
might  have  been  resented,  but  it  wasn't  considered  a  moral  issue,  a 
matter  of  right  and  wrong.  Some  things  just  happen.  This  has  been  the 
most  common  attitude  of  peasants  to  such  phenomena  throughout  hu- 
man history.  What's  striking  about  the  historical  record  is  that  in  the 
case  of  debt  crises,  this  was  not  how  many  reacted.  Many  actually  did 
become  indignant.  So  many,  in  fact,  that  most  of  our  contemporary 
language  of  social  justice,  our  way  of  speaking  of  human  bondage  and 
emancipation,  continues  to  echo  ancient  arguments  about  debt. 



It's  particularly  striking  because  so  many  other  things  do  seem  to 
have  been  accepted  as  simply  in  the  nature  of  things.  One  does  not  see 
a  similar  outcry  against  caste  systems,  for  example,  or  for  that  matter, 
the  institution  of  slavery.28  Surely  slaves  and  untouchables  often  experi- 
enced at  least  equal  horrors.  No  doubt  many  protested  their  condition. 
Why  was  it  that  the  debtors'  protests  seemed  to  carry  such  greater 
moral  weight?  Why  were  debtors  so  much  more  effective  in  winning 
the  ear  of  priests,  prophets,  officials,  and  social  reformers?  Why  was  it 
that  officials  like  Nehemiah  were  willing  to  give  such  sympathetic  con- 
sideration to  their  complaints,  to  inveigh,  to  summon  great  assemblies? 

Some  have  suggested  practical  reasons:  debt  crises  destroyed  the 
free  peasantry,  and  it  was  free  peasants  who  were  drafted  into  ancient 
armies  to  fight  in  wars.29  No  doubt  this  was  a  factor;  clearly  it  wasn't 
the  only  one.  There  is  no  reason  to  believe  that  Nehemiah,  for  instance, 
in  his  anger  at  the  usurers,  was  primarily  concerned  with  his  ability 
to  levy  troops  for  the  Persian  king.  It  is  something  more  fundamental. 

What  makes  debt  different  is  that  it  is  premised  on  an  assumption 
of  equality. 

To  be  a  slave,  or  lower-caste,  is  to  be  intrinsically  inferior.  We  are 
dealing  with  relations  of  unadulterated  hierarchy.  In  the  case  of  debt, 
we  are  dealing  with  two  individuals  who  begin  as  equal  parties  to  a 
contract.  Legally,  at  least  as  far  as  the  contract  is  concerned,  they  are 
the  same. 

We  can  add  that,  in  the  ancient  world,  when  people  who  actually 
were  more  or  less  social  equals  loaned  money  to  one  another,  the  terms 
appear  to  have  normally  been  quite  generous.  Often  no  interest  was 
charged,  or  if  it  was,  it  was  very  low.  "And  don't  charge  me  interest," 
wrote  one  wealthy  Canaanite  to  another,  in  a  tablet  dated  around 
1200  bc,  "after  all,  we  are  both  gentlemen."30  Between  close  kin,  many 
"loans"  were  probably,  then  as  now,  just  gifts  that  no  one  seriously 
expected  to  recover.  Loans  between  rich  and  poor  were  something 
else  again. 

The  problem  was  that,  unlike  status  distinctions  like  caste  or  slav- 
ery, the  line  between  rich  and  poor  was  never  precisely  drawn.  One  can 
imagine  the  reaction  of  a  farmer  who  went  up  to  the  house  of  a  wealthy 
cousin,  on  the  assumption  that  "humans  help  each  other,"  and  ended 
up,  a  year  or  two  later,  watching  his  vineyard  seized  and  his  sons  and 
daughters  led  away.  Such  behavior  could  be  justified,  in  legal  terms,  by 
insisting  that  the  loan  was  not  a  form  of  mutual  aid  but  a  commercial 
relationship — a  contract  is  a  contract.  (It  also  required  a  certain  reli- 
able access  to  superior  force.)  But  it  could  only  have  felt  like  a  terrible 
betrayal.  What's  more,  framing  it  as  a  breach  of  contract  meant  stating 



that  this  was,  in  fact,  a  moral  issue:  these  two  parties  ought  to  be 
equals,  but  one  had  failed  to  honor  the  bargain.  Psychologically,  this 
can  only  have  made  the  indignity  of  the  debtor's  condition  all  the  more 
painful,  since  it  made  it  possible  to  say  that  it  was  his  own  turpitude 
that  sealed  his  daughter's  fate.  But  that  just  made  the  motive  all  the 
more  compelling  to  throw  back  the  moral  aspersions:  "Our  flesh  is  as 
the  flesh  of  our  brethren,  our  children  as  their  children."  We  are  all  the 
same  people.  We  have  a  responsibility  to  take  account  of  one  another's 
needs  and  interests.  How  then  could  my  brother  do  this  to  me? 

In  the  Old  Testament  case,  debtors  were  able  to  marshal  a  particu- 
larly powerful  moral  argument — as  the  authors  of  Deuteronomy  con- 
stantly reminded  their  readers,  were  not  the  Jews  all  slaves  in  Egypt, 
and  had  they  not  all  been  redeemed  by  God?  Was  it  right,  when  they 
had  all  been  given  this  promised  land  to  share,  for  some  to  take  that 
land  away  from  others?  Was  it  right  for  a  population  of  liberated  slaves 
to  go  about  enslaving  one  aother's  children?31  But  analogous  arguments 
were  being  made  in  similar  situations  almost  everywhere  in  the  ancient 
world:  in  Athens,  in  Rome,  and  for  that  matter,  in  China — where  leg- 
end had  it  that  coinage  itself  was  first  invented  by  an  ancient  emperor 
to  redeem  the  children  of  families  who  had  been  forced  to  sell  them 
after  a  series  of  devastating  floods. 

Through  most  of  history,  when  overt  political  conflict  between 
classes  did  appear,  it  took  the  form  of  pleas  for  debt  cancellation — the 
freeing  of  those  in  bondage,  and  usually,  a  more  just  reallocation  of 
the  land.  What  we  see,  in  the  Bible  and  other  religious  traditions,  are 
traces  of  the  moral  arguments  by  which  such  claims  were  justified,  usu- 
ally subject  to  all  sorts  of  imaginative  twists  and  turns,  but  inevitably, 
to  some  degree,  incorporating  the  language  of  the  marketplace  itself. 

Chapter  Five 


TO  TELL  THE  HISTORY  of  debt,  then,  is  also  necessarily  to  recon- 
struct how  the  language  of  the  marketplace  has  come  to  pervade  every 
aspect  of  human  life — even  to  provide  the  terminology  for  the  moral 
and  religious  voices  ostensibly  raised  against  it.  We  have  already  seen 
how  both  Vedic  and  Christian  teachings  thus  end  up  making  the  same 
curious  move:  first  describing  all  morality  as  debt,  but  then,  in  their 
very  manner  of  doing  so,  demonstrating  that  morality  cannot  really  be 
reduced  to  debt,  that  it  must  be  grounded  in  something  else.1 

But  what?  Religious  traditions  prefer  vast,  cosmological  answers: 
the  alternative  to  the  morality  of  debt  lies  in  recognition  of  continu- 
ity with  the  universe,  or  life  in  the  expectation  of  the  imminent  an- 
nihilation of  the  universe,  or  absolute  subordination  to  the  deity,  or 
withdrawal  into  another  world.  My  own  aims  are  more  modest,  so  I 
will  take  the  opposite  approach.  If  we  really  want  to  understand  the 
moral  grounds  of  economic  life,  and  by  extension,  human  life,  it  seems 
to  me  that  we  must  start  instead  with  the  very  small  things:  the  every- 
day details  of  social  existence,  the  way  we  treat  our  friends,  enemies, 
and  children — often  with  gestures  so  tiny  (passing  the  salt,  bumming 
a  cigarette)  that  we  ordinarily  never  stop  to  think  about  them  at  all. 
Anthropology  has  shown  us  just  how  different  and  numerous  are  the 
ways  in  which  humans  have  been  known  to  organize  themselves.  But 
it  also  reveals  some  remarkable  commonalities — fundamental  moral 
principles  that  appear  to  exist  everywhere,  and  that  will  always  tend  to 
be  invoked,  wherever  people  transfer  objects  back  and  forth  or  argue 
about  what  other  people  owe  them. 

One  of  the  reasons  that  human  life  is  so  complicated,  in  turn,  is 
because  many  of  these  principles  contradict  one  another.  As  we  will 
see,  they  are  constantly  pulling  us  in  radically  different  directions.  The 
moral  logic  of  exchange,  and  hence  of  debt,  is  only  one;  in  any  given 
situation,  there  are  likely  to  be  completely  different  principles  that 



could  be  brought  to  bear.  In  this  sense,  the  moral  confusion  discussed 
in  the  first  chapter  is  hardly  new;  in  a  sense,  moral  thought  is  founded 
on  this  very  tension. 

To  really  understand  what  debt  is,  then,  it  will  be  necessary  to  un- 
derstand how  it's  different  from  other  sorts  of  obligation  that  human 
beings  might  have  to  one  another — which,  in  turn,  means  mapping 
out  what  those  other  sorts  of  obligation  actually  are.  Doing  so,  how- 
ever, poses  peculiar  challenges.  Contemporary  social  theory — economic 
anthropology  included — offers  surprisingly  little  help  in  this  regard. 
There's  an  enormous  anthropological  literature  on  gifts,  for  instance, 
starting  with  the  French  anthropologist  Marcel  Mauss's  essay  of  1925, 
even  on  "gift  economies"  that  operate  on  completely  different  prin- 
ciples than  market  economies — but  in  the  end,  almost  all  this  literature 
concentrates  on  the  exchange  of  gifts,  assuming  that  whenever  one 
gives  a  gift,  this  act  incurs  a  debt,  and  the  recipient  must  eventually 
reciprocate  in  kind.  Much  as  in  the  case  of  the  great  religions,  the 
logic  of  the  marketplace  has  insinuated  itself  even  into  the  thinking  of 
those  who  are  most  explicitly  opposed  to  it.  As  a  result,  I  am  going 
to  have  to  start  over  here,  to  create  a  new  theory,  pretty  much  from 

Part  of  the  problem  is  the  extraordinary  place  that  economics  cur- 
rently holds  in  the  social  sciences.  In  many  ways  it  is  treated  as  a  kind 
of  master  discipline.  Just  about  anyone  who  runs  anything  important 
in  America  is  expected  to  have  some  training  in  economic  theory,  or  at 
least  to  be  familiar  with  its  basic  tenets.  As  a  result,  those  tenets  have 
come  to  be  treated  as  received  wisdom,  as  basically  beyond  question 
(one  knows  one  is  in  the  presence  of  received  wisdom  when,  if  one 
challenges  it,  the  first  reaction  is  to  treat  one  as  simply  ignorant — 
"You  obviously  have  never  heard  of  the  Laffer  Curve";  "Clearly  you 
need  a  course  in  Economics  101" — the  theory  is  seen  as  so  obviously 
true  that  no  one  who  understands  it  could  possibly  disagree.)  What's 
more,  those  branches  of  social  theory  that  make  the  greatest  claims  to 
"scientific  status" — "rational  choice  theory,"  for  instance — start  from 
the  same  assumptions  about  human  psychology  that  economists  do: 
that  human  beings  are  best  viewed  as  self-interested  actors  calculating 
how  to  get  the  best  terms  possible  out  of  any  situation,  the  most  profit 
or  pleasure  or  happiness  for  the  least  sacrifice  or  investment — curious, 
considering  experimental  psychologists  have  demonstrated  over  and 
over  again  that  these  assumptions  simply  aren't  true.2 



From  early  on,  there  were  those  who  wished  to  create  a  theo- 
ry of  social  interaction  grounded  in  a  more  generous  view  of  human 
nature — insisting  that  moral  life  comes  down  to  something  more  than 
mutual  advantage,  that  it  is  motivated  above  all  by  a  sense  of  justice. 
The  key  term  here  became  "reciprocity,"  the  sense  of  equity,  balance, 
fairness,  and  symmetry,  embodied  in  our  image  of  justice  as  a  set  of 
scales.  Economic  transactions  were  just  one  variant  of  the  principle 
of  balanced  exchange — and  one  that  had  a  notorious  tendency  to  go 
awry.  But  if  one  examines  matters  closely,  one  finds  that  all  human 
relations  are  based  on  some  variation  on  reciprocity. 

In  the  1950s,  '60s  and  '70s,  there  was  something  of  a  craze  for  this 
sort  of  thing,  in  the  guise  of  what  was  then  called  "exchange  theory," 
developed  in  infinite  variations,  from  George  Homans'  "Social  Ex- 
change Theory"  in  the  United  States  to  Claude  Levi-Strauss's  Structur- 
alism in  France.  Levi-Strauss,  who  became  a  kind  of  intellectual  god  in 
anthropology,  made  the  extraordinary  argument  that  human  life  could 
be  imagined  as  consisting  of  three  spheres:  language  (which  consisted 
of  the  exchange  of  words),  kinship  (which  consisted  of  the  exchange  of 
women),  and  economics  (which  consisted  of  the  exchange  of  things). 
All  three,  he  insisted,  were  governed  by  the  same  fundamental  law  of 

Levi-Strauss's  star  is  fallen  now,  and  such  extreme  statements  seem, 
in  retrospect,  a  little  bit  ridiculous.  Still,  it's  not  as  if  anyone  has  pro- 
posed a  bold  new  theory  to  replace  all  this.  Instead,  the  assumptions 
have  simply  retreated  into  the  background.  Almost  everyone  continues 
to  assume  that  in  its  fundamental  nature,  social  life  is  based  on  the 
principle  of  reciprocity,  and  therefore  that  all  human  interaction  can 
best  be  understood  as  a  kind  of  exchange.  If  so,  then  debt  really  is  at 
the  root  of  all  morality,  because  debt  is  what  happens  when  some  bal- 
ance has  not  yet  been  restored. 

But  can  all  justice  really  be  reduced  to  reciprocity?  It's  easy  enough 
to  come  up  with  forms  of  reciprocity  that  don't  seem  particularly  just. 
"Do  unto  others  as  you  would  wish  others  to  do  unto  you"  might  seem 
like  an  excellent  foundation  for  a  system  of  ethics,  but  for  most  of  us, 
"an  eye  for  an  eye"  does  not  evoke  justice  so  much  as  vindictive  brutal- 
ity.4 "One  good  turn  deserves  another"  is  a  pleasant  sentiment,  but  "I'll 
scratch  your  back,  you  scratch  mine"  is  shorthand  for  political  corrup- 
tion. Conversely,  there  are  relationships  that  seem  clearly  moral  but 
appear  to  have  nothing  to  do  with  reciprocity.  The  relation  between 
mother  and  child  is  an  oft-cited  example.  Most  of  us  learn  our  sense  of 
justice  and  morality  first  from  our  parents.  Yet  it  is  extremely  difficult 
to  see  the  relatiqn  between  parent  and  child  as  particularly  reciprocal. 



Would  we  really  be  willing  to  conclude  that  therefore  it  is  not  a  moral 
relationship?  That  it  has  nothing  to  do  with  justice? 

The  Canadian  novelist  Margaret  Atwood  begins  a  recent  book  on 
debt  with  a  similar  paradox: 

Nature  Writer  Ernest  Thompson  Seton  had  an  odd  bill  pre- 
sented to  him  on  his  twenty-first  birthday.  It  was  a  record  kept 
by  his  father  of  all  the  expenses  connected  with  young  Ernest's 
childhood  and  youth,  including  the  fee  charged  by  the  doctor 
for  delivering  him.  Even  more  oddly,  Ernest  is  said  to  have  paid 
it.  I  used  to  think  that  Mr.  Seton  Senior  was  a  jerk,  but  now 
I'm  wondering.5 

Most  of  us  wouldn't  wonder  much.  Such  behavior  seems  mon- 
strous, inhuman.  Certainly  Seton  did:  he  paid  the  bill,  but  never  spoke 
to  his  father  again  afterward.6  And  in  a  way,  this  is  precisely  why  the 
presentation  of  such  a  bill  seems  so  outrageous.  Squaring  accounts 
means  that  the  two  parties  have  the  ability  to  walk  away  from  each 
other.  By  presenting  it,  his  father  suggested  he'd  just  as  soon  have  noth- 
ing further  to  do  with  him. 

In  other  words,  while  most  of  us  can  imagine  what  we  owe  to  our 
parents  as  a  kind  of  debt,  few  of  us  can  imagine  being  able  to  actually 
pay  it — or  even  that  such  a  debt  ever  should  be  paid.  Yet  if  it  can't  be 
paid,  in  what  sense  is  it  a  "debt"  at  all?  And  if  it  is  not  a  debt,  what 
is  it? 

One  obvious  place  to  look  for  alternatives  is  in  cases  of  human  inter- 
action in  which  expectations  of  reciprocity  seem  to  slam  into  a  wall. 
Nineteenth-century  travelers'  accounts,  for  instance,  are  full  of  this  sort 
of  thing.  Missionaries  working  in  certain  parts  of  Africa  would  often 
be  astounded  by  the  reactions  they  would  receive  when  they  adminis- 
tered medicines.  Here's  a  typical  example,  from  a  British  missionary 
in  Congo: 

A  day  or  two  after  we  reached  Vana  we  found  one  of  the  na- 
tives very  ill  with  pneumonia.  Comber  treated  him  and  kept 
him  alive  on  strong  fowl-soup;  a  great  deal  of  careful  nursing 
and  attention  was  visited  on  him,  for  his  house  was  beside  the 
camp.  When  we  were  ready  to  go  on  our  way  again,  the  man 
was  well.  To  our  astonishment  he  came  and  asked  us  for  a 



present,  and  was  as  astonished  and  disgusted  as  he  had  made 
us  to  be,  when  we  declined  giving  it.  We  suggested  that  it  was 
his  place  to  bring  us  a  present  and  to  show  some  gratitude. 
He  said  to  us,  "Well  indeed!  You  white  men  have  no  shame!"7 

In  the  early  decades  of  the  twentieth  century,  the  French  philoso- 
pher Lucien  Levy-Bruhl,  in  an  attempt  to  prove  that  "natives"  oper- 
ated with  an  entirely  different  form  of  logic,  compiled  a  list  of  similar 
stories:  for  instance,  of  a  man  saved  from  drowning  who  proceeded  to 
ask  his  rescuer  to  give  him  some  nice  clothes  to  wear,  or  another  who, 
on  being  nursed  back  to  health  after  having  been  savaged  by  a  tiger, 
demanded  a  knife.  One  French  missionary  working  in  Central  Africa 
insisted  that  such  things  happened  to  him  on  a  regular  basis: 

You  save  a  person's  life,  and  you  must  expect  to  receive  a  visit 
from  him  before  long;  you  are  now  under  an  obligation  to  him, 
and  you  will  not  get  rid  of  him  except  by  giving  him  presents.8 

Now,  certainly,  there  is  almost  always  felt  to  be  something  ex- 
traordinary about  saving  a  life.  Anything  surrounding  birth  and  death 
almost  cannot  help  but  partake  of  the  infinite,  and,  therefore,  throw 
all  everyday  means  of  moral  calculation  askew.  This  is  probably  why 
stories  like  this  had  become  something  of  a  cliche  in  America  when  I 
was  growing  up.  I  remember  as  a  child  several  times  being  told  that 
among  the  Inuit  (or  sometimes  it  was  among  Buddhists,  or  Chinese, 
but  curiously,  never  Africans) — that  if  one  saves  someone  else's  life, 
one  is  considered  responsible  for  taking  care  of  that  person  forever. 
It  defies  our  sense  of  reciprocity.  But  somehow,  it  also  makes  a  weird 
kind  of  sense. 

We  have  no  way  of  knowing  what  was  really  going  on  in  the  minds 
of  the  patients  in  these  stories,  since  we  don't  know  who  they  were 
or  what  sort  of  expectations  they  had  (how  they  normally  interacted 
with  their  doctors,  for  example).  But  we  can  guess.  Let's  try  a  thought 
experiment.  Imagine  that  we  are  dealing  with  a  place  where,  if  one 
man  saved  another's  life,  the  two  became  like  brothers.  Each  was  now 
expected  to  share  everything,  and  to  provide  for  the  other  when  he 
was  in  need.  If  so,  the  patient  would  surely  notice  that  his  new  brother 
appeared  to  be  extraordinarily  wealthy,  not  in  much  need  of  anything, 
but  that  he,  the  patient,  was  lacking  in  many  things  the  missionary 
could  provide. 

Alternately  (and  more  likely),  imagine  that  we  are  dealing  not  with 
a  relationship  of  radical  equality  but  the  very  opposite.  In  many  parts 



of  Africa,  accomplished  curers  were  also  important  political  figures 
with  extensive  clienteles  of  former  patients.  A  would-be  follower  thus 
arrives  to  declare  his  political  allegiance.  What  complicates  the  matter 
in  this  case  is  that  followers  of  great  men,  in  this  part  of  Africa,  were 
in  a  relatively  strong  bargaining  position.  Good  henchmen  were  hard 
to  come  by;  important  people  were  expected  to  be  generous  with  fol- 
lowers to  keep  them  from  joining  some  rival's  entourage  instead.  If  so, 
asking  for  a  shirt  or  knife  would  be  a  way  of  asking  for  confirmation 
that  the  missionary  does  wish  to  have  the  man  as  a  follower.  Paying 
him  back,  in  contrast,  would  be,  like  Seton's  gesture  to  his  father,  an 
insult:  a  way  of  saying  that  despite  the  missionary  having  saved  his  life, 
he  would  just  as  soon  have  nothing  further  to  do  with  him. 

This  is  a  thought  experiment — because  we  don't  really  know  what  the 
African  patients  were  thinking.  The  point  is  that  such  forms  of  radical 
equality  and  radical  inequality  do  exist  in  the  world,  that  each  carries 
within  it  its  own  kind  of  morality,  its  own  way  of  thinking  and  arguing 
about  the  rights  and  wrongs  of  any  given  situation,  and  these  morali- 
ties are  entirely  different  than  that  of  tit-for-tat  exchange.  In  the  rest  of 
the  chapter,  I  will  provide  a  rough-and-ready  way  to  map  out  the  main 
possibilities,  by  proposing  that  there  are  three  main  moral  principles 
on  which  economic  relations  can  be  founded,  all  of  which  occur  in 
any  human  society,  and  which  I  will  call  communism,  hierarchy,  and 


I  will  define  communism  here  as  any  human  relationship  that  operates 
on  the  principles  of  "from  each  according  to  their  abilities,  to  each  ac- 
cording to  their  needs." 

I  admit  that  the  usage  here  is  a  bit  provocative.  "Communism"  is 
a  word  that  can  evoke  strong  emotional  reactions — mainly,  of  course, 
because  we  tend  to  identify  it  with  "communist"  regimes.  This  is  iron- 
ic, since  the  Communist  parties  that  ruled  over  the  USSR  and  its  sat- 
ellites, and  that  still  rule  China  and  Cuba,  never  described  their  own 
systems  as  "communist."  They  described  them  as  "socialist."  "Com- 
munism" was  always  a  distant,  somewhat  fuzzy  Utopian  ideal,  usually 



to  be  accompanied  by  the  withering  away  of  the  state — to  be  achieved 
at  some  point  in  the  distant  future. 

Our  thinking  about  communism  has  been  dominated  by  a  myth. 
Once  upon  a  time,  humans  held  all  things  in  common — in  the  Gar- 
den of  Eden,  during  the  Golden  Age  of  Saturn,  in  Paleolithic  hunter- 
gatherer  bands.  Then  came  the  Fall,  as  a  result  of  which  we  are  now 
cursed  with  divisions  of  power  and  private  property.  The  dream  was 
that  someday,  with  the  advance  of  technology  and  general  prosperity, 
with  social  revolution  or  the  guidance  of  the  Party,  we  would  finally 
be  in  a  position  to  put  things  back,  to  restore  common  ownership  and 
common  management  of  collective  resources.  Throughout  the  last  two 
centuries,  Communists  and  anti-Communists  argued  over  how  plau- 
sible this  picture  was  and  whether  it  would  be  a  blessing  or  a  night- 
mare. But  they  all  agreed  on  the  basic  framework:  communism  was 
about  collective  property,  "primitive  communism"  did  once  exist  in  the 
distant  past,  and  someday  it  might  return. 

We  might  call  this  "mythic  communism" — or  even,  "epic 
communism" — a  story  we  like  to  tell  ourselves.  Since  the  days  of  the 
French  Revolution,  it  has  inspired  millions;  but  it  has  also  done  enor- 
mous damage  to  humanity.  It's  high  time,  I  think,  to  brush  the  entire 
argument  aside.  In  fact,  "communism"  is  not  some  magical  Utopia, 
and  neither  does  it  have  anything  to  do  with  ownership  of  the  means 
of  production.  It  is  something  that  exists  right  now — that  exists,  to 
some  degree,  in  any  human  society,  although  there  has  never  been  one 
in  which  everything  has  been  organized  in  that  way,  and  it  would  be 
difficult  to  imagine  how  there  could  be.  All  of  us  act  like  communists 
a  good  deal  of  the  time.  None  of  us  acts  like  a  communist  consistently. 
"Communist  society" — in  the  sense  of  a  society  organized  exclusively 
on  that  single  principle — could  never  exist.  But  all  social  systems,  even 
economic  systems  like  capitalism,  have  always  been  built  on  top  of  a 
bedrock  of  actually-existing  communism. 

Starting,  as  I  say,  from  the  principle  of  "from  each  according  to 
their  abilities,  to  each  according  to  their  needs"  allows  us  to  look  past 
the  question  of  individual  or  private  ownership  (which  is  often  little 
more  than  formal  legality  anyway)  and  at  much  more  immediate  and 
practical  questions  of  who  has  access  to  what  sorts  of  things  and  under 
what  conditions.9  Whenever  it  is  the  operative  principle,  even  if  it's  just 
two  people  who  are  interacting,  we  can  say  we  are  in  the  presence  of 
a  sort  of  communism. 

Almost  everyone  follows  this  principle  if  they  are  collaborating  on 
some  common  project.10  If  someone  fixing  a  broken  water  pipe  says, 
"Hand  me  the  wrench,"  his  co-worker  will  not,  generally  speaking, 



say,  "And  what  do  I  get  for  it?" — even  if  they  are  working  for  Exxon- 
Mobil, Burger  King,  or  Goldman  Sachs.  The  reason  is  simple  efficiency 
(ironically  enough,  considering  the  conventional  wisdom  that  "com- 
munism just  doesn't  work"):  if  you  really  care  about  getting  something 
done,  the  most  efficient  way  to  go  about  it  is  obviously  to  allocate  tasks 
by  ability  and  give  people  whatever  they  need  to  do  them."  One  might 
even  say  that  it's  one  of  the  scandals  of  capitalism  that  most  capital- 
ist firms,  internally,  operate  communistically.  True,  they  don't  tend 
to  operate  very  democratically.  Most  often  they  are  organized  around 
military-style  top-down  chains  of  command.  But  there  is  often  an  in- 
teresting tension  here,  because  top-down  chains  of  command  are  not 
particularly  efficient:  they  tend  to  promote  stupidity  among  those  on 
top,  resentful  foot-dragging  among  those  on  the  bottom.  The  greater 
the  need  to  improvise,  the  more  democratic  the  cooperation  tends  to 
become.  Inventors  have  always  understood  this,  start-up  capitalists  fre- 
quently figure  it  out,  and  computer  engineers  have  recently  rediscov- 
ered the  principle:  not  only  with  things  like  freeware,  which  everyone 
talks  about,  but  even  in  the  organization  of  their  businesses.  Apple 
Computers  is  a  famous  example:  it  was  founded  by  (mostly  Republi- 
can) computer  engineers  who  broke  from  IBM  in  Silicon  Valley  in  the 
1980s,  forming  little  democratic  circles  of  twenty  to  forty  people  with 
their  laptops  in  each  other's  garages. 

This  is  presumably  also  why  in  the  immediate  wake  of  great  di- 
sasters— a  flood,  a  blackout,  or  an  economic  collapse — people  tend 
to  behave  the  same  way,  reverting  to  a  rough-and-ready  communism. 
However  briefly,  hierarchies  and  markets  and  the  like  become  luxuries 
that  no  one  can  afford.  Anyone  who  has  lived  through  such  a  moment 
can  speak  to  their  peculiar  qualities,  the  way  that  strangers  become 
sisters  and  brothers  and  human  society  itself  seems  to  be  reborn.  This 
is  important,  because  it  shows  that  we  are  not  simply  talking  about 
cooperation.  In  fact,  communism  is  the  foundation  of  all  human  socia- 
bility. It  is  what  makes  society  possible.  There  is  always  an  assumption 
that  anyone  who  is  not  actually  an  enemy  can  be  expected  on  the  prin- 
ciple of  "from  each  according  to  their  abilities,"  at  least  to  an  extent: 
for  example,  if  one  needs  to  figure  out  how  to  get  somewhere,  and  the 
other  knows  the  way. 

We  so  take  this  for  granted,  in  fact,  that  the  exceptions  are  them- 
selves revealing.  E.E.  Evans-Pritchard,  an  anthropologist  who  in  the 
1920s  carried  out  research  among  the  Nuer,  Nilotic  pastoralists  in 
southern  Sudan,  reports  his  discomfiture  when  he  realized  that  some- 
one had  intentionally  given  him  wrong  directions: 



On  one  occasion  I  asked  the  way  to  a  certain  place  and  was 
deliberately  deceived.  I  returned  in  chagrin  to  camp  and  asked 
the  people  why  they  had  told  me  the  wrong  way.  One  of  them 
replied,  "You  are  a  foreigner,  why  should  we  tell  you  the  right 
way?  Even  if  a  Nuer  who  was  a  stranger  asked  us  the  way  we 
would  say  to  him,  'You  continue  straight  along  that  path,'  but 
we  would  not  tell  him  that  the  path  forked.  Why  should  we  tell 
him?  But  you  are  now  a  member  of  our  camp  and  you  are  kind 
to  our  children,  so  we  will  tell  you  the  right  way  in  future."12 

The  Nuer  are  constantly  engaged  in  feuds;  any  stranger  might  well 
turn  out  to  be  an  enemy  there  to  scout  out  a  good  place  for  an  am- 
bush, and  it  would  be  unwise  to  give  such  a  person  useful  information. 
What's  more,  Evans-Pritchard's  own  situation  was  obviously  relevant, 
since  he  was  an  agent  of  the  British  government — the  same  government 
that  had  recently  sent  in  the  RAF  to  strafe  and  bomb  the  inhabitants 
of  this  very  settlement  before  forcibly  resettling  them  there.  Under 
the  circumstances,  the  inhabitants'  treatment  of  Evans-Pritchard  seems 
quite  generous.  The  main  point,  though,  is  that  it  requires  something 
on  this  scale — an  immediate  threat  to  life  and  limb,  terror-bombing  of 
civilian  populations — before  people  will  ordinarily  consider  not  giving 
a  stranger  accurate  directions. '•' 

It's  not  just  directions.  Conversation  is  a  domain  particularly  dis- 
posed to  communism.  Lies,  insults,  put-downs,  and  other  sorts  of  ver- 
bal aggression  are  important — but  they  derive  most  of  their  power 
from  the  shared  assumption  that  people  do  not  ordinarily  act  this  way: 
an  insult  does  not  sting  unless  one  assumes  that  others  will  normally 
be  considerate  of  one's  feelings,  and  it's  impossible  to  lie  to  someone 
who  does  not  assume  you  would  ordinarily  tell  the  truth.  When  we 
genuinely  wish  to  break  off  amicable  relations  with  someone,  we  stop 
speaking  to  them  entirely. 

The  same  goes  for  small  courtesies  like  asking  for  a  light,  or  even 
for  a  cigarette.  It  seems  more  legitimate  to  ask  a  stranger  for  a  cigarette 
than  for  an  equivalent  amount  of  cash,  or  even  food;  in  fact,  if  one  has 
been  identified  as  a  fellow  smoker,  it's  rather  difficult  to  refuse  such  a 
request.  In  such  cases — a  match,  a  piece  of  information,  holding  the 
elevator — one  might  say  the  "from  each"  element  is  so  minimal  that 
most  of  us  comply  without  even  thinking  about  it.  Conversely,  the 
same  is  true  if  another  person's  need — even  a  stranger's — is  particular- 
ly spectacular  or  extreme:  if  he  is  drowning,  for  example.  If  a  child  has 
fallen  onto  the  subway  tracks,  we  assume  that  anyone  who  is  capable 
of  helping  her  up  will  do  so. 



I  will  call  this  "baseline  communism":  the  understanding  that, 
unless  people  consider  themselves  enemies,  if  the  need  is  considered 
great  enough,  or  the  cost  considered  reasonable  enough,  the  principle 
of  "from  each  according  to  their  abilities,  to  each  according  to  their 
needs"  will  be  assumed  to  apply.  Of  course,  different  communities  ap- 
ply very  different  standards.  In  large,  impersonal  urban  communities, 
such  a  standard  may  go  no  further  than  asking  for  a  light  or  directions. 
This  might  not  seem  like  much,  but  it  founds  the  possibility  of  larger 
social  relations.  In  smaller,  less  impersonal  communities — especially 
those  not  divided  into  social  classes — the  same  logic  will  likely  extend 
much  further:  for  example,  it  is  often  effectively  impossible  to  refuse 
a  request  not  just  for  tobacco,  but  for  food — sometimes  even  from 
a  stranger;  certainly  from  anyone  considered  to  belong  to  the  com- 
munity. Exactly  one  page  after  describing  his  difficulties  in  asking  for 
directions,  Evans-Pritchard  notes  that  these  same  Nuer  find  it  almost 
impossible,  when  dealing  with  someone  they  have  accepted  as  a  mem- 
ber of  their  camp,  to  refuse  a  request  for  almost  any  item  of  common 
consumption,  so  that  a  man  or  woman  known  to  have  anything  extra 
in  the  way  of  grain,  tobacco,  tools,  or  agricultural  implements  can  be 
expected  to  see  their  stockpiles  disappear  almost  immediately.14  How- 
ever, this  baseline  of  openhanded  sharing  and  generosity  never  extends 
to  everything.  Often,  in  fact,  things  freely  shared  are  treated  as  trivial 
and  unimportant  for  that  very  reason.  Among  the  Nuer,  true  wealth 
takes  the  form  of  cattle.  No  one  would  freely  share  their  cattle;  in  fact, 
young  Nuer  men  learn  that  they  are  expected  to  defend  their  cattle 
with  their  lives;  for  this  reason,  cattle  are  neither  bought  nor  sold. 

The  obligation  to  share  food,  and  whatever  else  is  considered  a  ba- 
sic necessity,  tends  to  become  the  basis  of  everyday  morality  in  a  society 
whose  members  see  themselves  as  equals.  Another  anthropologist,  Au- 
drey Richards,  once  described  how  Bemba  mothers,  "such  lax  discipli- 
narians in  everything  else,"  will  scold  their  children  harshly  if  they  give 
one  an  orange  or  some  other  treat  and  the  child  does  not  immediately 
offer  to  share  it  with  her  friends.15  But  sharing  is  also,  in  such  societies — 
in  any,  if  we  really  think  about  it — a  major  focus  of  life's  pleasures. 
As  a  result,  the  need  to  share  is  particularly  acute  in  both  the  best  of 
times  and  the  worst  of  times:  during  famines,  for  example,  but  also 
during  moments  of  extreme  plenty.  Early  missionary  accounts  of  native 
North  Americans  almost  invariably  include  awestruck  remarks  on  gen- 
erosity in  times  of  famine,  often  to  total  strangers.16  At  the  same  time, 

On  returning  from  their  fishing,  their  hunting,  and  their  trading, 
they  exchange  many  gifts;  if  they  have  thus  obtained  something 



unusually  good,  even  if  they  have  bought  it,  or  if  it  has  been 
given  to  them,  they  make  a  feast  to  the  whole  village  with  it. 
Their  hospitality  towards  all  sorts  of  strangers  is  remarkable.17 

The  more  elaborate  the  feast,  the  more  likely  one  is  to  see  some 
combination  of  free  sharing  of  some  things  (for  instance,  food  and 
drink)  and  careful  distribution  of  others:  say,  prize  meat,  whether  from 
game  or  sacrifice,  which  is  often  parceled  out  according  to  very  elabo- 
rate protocols  or  equally  elaborate  gift  exchange.  The  giving  and  tak- 
ing of  gifts  often  takes  on  a  distinctly  gamelike  quality,  continuous 
often  with  the  actual  games,  contests,  pageants,  and  performances  that 
also  often  mark  popular  festivals.  As  with  society  at  large,  the  shared 
conviviality  could  be  seen  as  a  kind  of  communistic  base  on  top  of 
which  everything  else  is  constructed.  It  also  helps  to  emphasize  that 
sharing  is  not  simply  about  morality,  but  also  about  pleasure.  Soli- 
tary pleasures  will  always  exist,  but  for  most  human  beings,  the  most 
pleasurable  activities  almost  always  involve  sharing  something:  music, 
food,  liquor,  drugs,  gossip,  drama,  beds.  There  is  a  certain  communism 
of  the  senses  at  the  root  of  most  things  we  consider  fun. 

The  surest  way  to  know  that  one  is  in  the  presence  of  commu- 
nistic relations  is  that  not  only  are  no  accounts  taken,  but  it  would 
be  considered  offensive,  or  simply  bizarre,  to  even  consider  doing  so. 
Each  village,  clan,  or  nation  within  the  League  of  the  Hodenosaunee, 
or  Iroquois,  for  example,  was  divided  into  two  halves.18  This  is  a  com- 
mon pattern:  in  other  parts  of  the  world  (Amazonia,  Melanesia)  too, 
there  are  arrangements  in  which  members  of  one  side  can  only  marry 
someone  from  the  other  side,  or  only  eat  food  grown  on  the  other  side; 
such  rules  are  explicitly  designed  to  make  each  side  dependent  on  the 
other  for  some  basic  necessity  of  life.  Among  the  Six  Iroquois,  each  side 
was  expected  to  bury  the  other's  dead.  Nothing  would  be  more  absurd 
than  for  one  side  to  complain  that,  "last  year,  we  buried  five  of  your 
dead,  but  you  only  buried  two  of  ours." 

Baseline  communism  might  be  considered  the  raw  material  of  soci- 
ality, a  recognition  of  our  ultimate  interdependence  that  is  the  ultimate 
substance  of  social  peace.  Still,  in  most  circumstances,  that  minimal 
baseline  is  not  enough.  One  always  behaves  in  a  spirit  of  solidarity 
more  with  some  people  than  others,  and  certain  institutions  are  spe- 
cifically based  on  principles  of  solidarity  and  mutual  aid.  First  among 
these  are  those  we  love,  with  mothers  being  the  paradigm  of  selfless 
love.  Others  include  close  relatives,  wives  and  husbands,  lovers,  one's 
closest  friends.  These  are  the  people  with  whom  we  share  everything, 
or  at  least  to  whom  we  know  we  can  turn  in  need,  which  is  the 



definition  of  a  true  friend  everywhere.  Such  friendships  may  be  formal- 
ized by  a  ritual  as  "bond-friends"  or  "blood  brothers"  who  cannot 
refuse  each  other  anything.  As  a  result,  any  community  could  be  seen 
as  criss-crossed  with  relations  of  "individualistic  communism,"  one-to- 
one  relations  that  operate,  to  varying  intensities  and  degrees,  on  the 
basis  of  "from  each  according  to  their  ability,  to  each  according  to 
their  needs.'"9 

This  same  logic  can  be,  and  is,  extended  within  groups:  not  only 
cooperative  work  groups,  but  almost  any  in-group  will  define  itself  by 
creating  its  own  sort  of  baseline  communism.  There  will  be  certain 
things  shared  or  made  freely  available  within  the  group,  others  that 
anyone  will  be  expected  to  provide  for  other  members  on  request,  that 
one  would  never  share  with  or  provide  to  outsiders:  help  in  repair- 
ing one's  nets  in  an  association  of  fisherman,  stationery  supplies  in 
an  office,  certain  sorts  of  information  among  commodity  traders,  and 
so  forth.  Also,  certain  categories  of  people  we  can  always  call  on  in 
certain  situations,  such  as  harvesting  or  moving  house.20  One  could  go 
on  from  here  to  various  forms  of  sharing,  pooling,  who  gets  to  call  on 
whom  for  help  with  certain  tasks:  moving,  or  harvesting,  or  even,  if 
one  is  in  trouble,  providing  an  interest-free  loan.  Finally,  there  are  the 
different  sorts  of  "commons,"  the  collective  administration  of  common 

The  sociology  of  everyday  communism  is  a  potentially  enormous 
field,  but  one  which,  owing  to  our  peculiar  ideological  blinkers,  we 
have  been  unable  to  write  about  because  we  have  been  largely  unable 
to  see  it.  Rather  than  try  to  further  outline  it,  I  will  limit  myself  to 
three  final  points. 

First,  we  are  not  really  dealing  with  reciprocity  here — or  at  best, 
only  with  reciprocity  in  the  broadest  sense.21  What  is  equal  on  both 
sides  is  the  knowledge  that  the  other  person  would  do  the  same  for 
you,  not  that  they  necessarily  will.  The  Iroquois  example  brings  home 
clearly  what  makes  this  possible:  that  such  relations  are  based  on  a 
presumption  of  eternity.  Society  will  always  exist.  Therefore,  there 
will  always  be  a  north  and  a  south  side  of  the  village.  This  is  why  no 
accounts  need  be  taken.  In  a  similar  way,  people  tend  to  treat  their 
mothers  and  best  friends  as  if  they  will  always  exist,  however  well  they 
know  it  isn't  true. 

The  second  point  has  to  do  with  the  famous  "law  of  hospitality." 
There  is  a  peculiar  tension  between  a  common  stereotype  of  what  are 
called  "primitive  societies"  (people  lacking  both  states  and  markets) 
as  societies  in  which  anyone  not  a  member  of  the  community  is  as- 
sumed to  be  an  enemy,  and  the  frequent  accounts  of  early  European 



travelers  awestruck  by  the  extraordinary  generosity  shown  them  by 
actual  "savages."  Granted,  there  is  a  certain  truth  to  both  sides.  Wher- 
ever a  stranger  is  a  dangerous  potential  enemy,  the  normal  way  to 
overcome  the  danger  is  by  some  dramatic  gesture  of  generosity  whose 
very  magnificence  catapults  them  into  that  mutual  sociality  that  is  the 
ground  for  all  peaceful  social  relations.  True,  when  one  is  dealing  with 
completely  unknown  quantities,  there  is  often  a  process  of  testing.  Both 
Christopher  Columbus,  in  Hispaniola,  and  Captain  Cook,  in  Polynesia, 
reported  similar  stories  of  islanders  who  either  flee,  attack,  or  offer 
everything — but  who  often  later  enter  the  boats  and  help  themselves  to 
anything  they  take  a  fancy  to,  provoking  threats  of  violence  from  the 
crew,  who  then  did  their  utmost  to  establish  the  principle  that  relations 
between  strange  peoples  should  be  mediated  instead  by  "normal"  com- 
mercial exchange. 

It's  understandable  that  dealings  with  potentially  hostile  strangers 
should  encourage  an  all-or-nothing  logic,  a  tension  preserved  even  in 
English  in  the  etymology  of  the  words  "host,"  "hostile,"  "hostage," 
and  indeed  "hospitality,"  all  of  which  are  derived  from  the  same  Latin 
root.22  What  I  want  to  emphasize  here  is  that  all  such  gestures  are 
simply  exaggerated  displays  of  that  very  "baseline  communism"  that  I 
have  already  argued  is  the  ground  of  all  human  social  life.  This  is  why, 
for  instance,  the  difference  between  friends  and  enemies  is  so  often 
articulated  through  food — and  often  the  most  commonplace,  humble, 
domestic  sorts  of  food:  as  in  the  familiar  principle,  common  in  both 
Europe  and  the  Middle  East,  that  those  who  have  shared  bread  and 
salt  must  never  harm  one  another.  In  fact,  those  things  that  exist  above 
all  to  be  shared  often  become  those  things  one  cannot  share  with  en- 
emies. Among  the  Nuer,  so  free  with  food  and  everyday  possessions, 
if  one  man  murders  another,  a  blood  feud  follows.  Everyone  in  the 
vicinity  will  often  have  to  line  up  on  one  side  or  another,  and  those  on 
opposite  sides  are  strictly  forbidden  to  eat  with  anyone  on  the  other, 
or  even  to  drink  from  a  cup  or  bowl  one  of  their  newfound  enemies 
has  previously  used,  lest  terrible  results  ensue.23  The  extraordinary  in- 
convenience this  creates  is  a  major  incentive  to  try  to  negotiate  some 
sort  of  settlement.  By  the  same  token,  it  is  often  said  that  people  who 
have  shared  food,  or  the  right,  archetypal  kind  of  food,  are  forbidden 
to  harm  one  another,  however  much  they  might  be  otherwise  inclined 
to  do  so.  At  times,  this  can  take  on  an  almost  comical  formality,  as  in 
the  Arab  story  of  the  burglar  who,  while  ransacking  someone's  house, 
stuck  his  finger  in  a  jar  to  see  if  it  was  full  of  sugar,  only  to  discover 
it  was  full  of  salt  instead.  Realizing  that  he  had  now  eaten  salt  at  the 
owner's  table,  he  dutifully  put  back  everything  he'd  stolen. 



Finally,  once  we  start  thinking  of  communism  as  a  principle  of 
morality  rather  than  just  a  question  of  property  ownership,  it  becomes 
clear  that  this  sort  of  morality  is  almost  always  at  play  to  some  degree 
in  any  transaction — even  commerce.  If  one  is  on  sociable  terms  with 
someone,  it's  hard  to  completely  ignore  their  situation.  Merchants  of- 
ten reduce  prices  for  the  needy.  This  is  one  of  the  main  reasons  why 
shopkeepers  in  poor  neighborhoods  are  almost  never  of  the  same  ethnic 
group  as  their  customers;  it  would  be  almost  impossible  for  a  merchant 
who  grew  up  in  the  neighborhood  to  make  money,  as  they  would  be 
under  constant  pressure  to  give  financial  breaks,  or  at  least  easy  credit 
terms,  to  their  impoverished  relatives  and  school  chums.  The  opposite 
is  true  as  well.  An  anthropologist  who  lived  for  some  time  in  rural  Java 
once  told  me  that  she  measured  her  linguistic  abilities  by  how  well  she 
could  bargain  at  the  local  bazaar.  It  frustrated  her  that  she  could  never 
get  it  down  to  a  price  as  low  as  local  people  seemed  pay.  "Well,"  a  Ja- 
vanese friend  finally  had  to  explain,  "they  charge  rich  Javanese  people 
more,  too." 

Once  again,  we  are  back  to  the  principle  that  if  the  needs  (for 
instance,  dire  poverty),  or  the  abilities  (for  instance,  wealth  beyond 
imagination),  are  sufficiently  dramatic,  then  unless  there  is  a  complete 
absence  of  sociality,  some  degree  of  communistic  morality  will  almost 
inevitably  enter  into  the  way  people  take  accounts.24  A  Turkish  folktale 
about  the  Medieval  Sufi  mystic  Nasruddin  Hodja  illustrates  the  com- 
plexities thus  introduced  into  the  very  concept  of  supply  and  demand: 

One  day  when  Nasruddin  was  left  in  charge  of  the  local  tea- 
house, the  king  and  some  retainers,  who  had  been  hunting 
nearby,  stopped  in  for  breakfast. 

"Do  you  have  quail  eggs?"  asked  the  king. 

"I'm  sure  I  can  find  some,"  answered  Nasruddin. 

The  king  ordered  an  omelet  of  a  dozen  quail  eggs,  and 
Nasruddin  hurried  out  to  look  for  them.  After  the  king  and  his 
party  had  eaten,  he  charged  them  a  hundred  gold  pieces. 

The  king  was  puzzled.  "Are  quail  eggs  really  that  rare  in  this 
part  of  the  country?" 

"It's  not  so  much  quail  eggs  that  are  rare  around  here," 
Nasruddin  replied.  "It's  more  visits  from  kings." 


Communism,  then,  is  based  neither  in  exchange  nor  in  reciprocity — 
except,  as  I  have  observed,  in  the  sense  that  it  does  involve  mutual  ex- 
pectations and  responsibilities.  Even  here,  it  seems  better  to  use  another 



word  ("mutuality"?)  so  as  to  emphasize  that  exchange  operates  on 
entirely  different  principles;  that  it's  a  fundamentally  different  kind  of 
moral  logic. 

Exchange  is  all  about  equivalence.  It's  a  back-and-forth  process 
involving  two  sides  in  which  each  side  gives  as  good  as  it  gets.  This 
is  why  one  can  speak  of  people  exchanging  words  (if  there's  an  argu- 
ment), blows,  or  even  gunfire.25  In  these  examples,  it's  not  that  there 
is  ever  an  exact  equivalence — even  if  there  were  some  way  to  measure 
an  exact  equivalence — but  more  a  constant  process  of  interaction  tend- 
ing toward  equivalence.  Actually,  there's  something  of  a  paradox  here: 
each  side  in  each  case  is  trying  to  outdo  the  other,  but,  unless  one  side 
is  utterly  put  to  rout,  it's  easiest  to  break  the  whole  thing  off  when 
both  consider  the  outcome  to  be  more  or  less  even.  When  we  move  to 
the  exchange  of  material  goods,  we  find  a  similar  tension.  Often  there 
is  an  element  of  competition;  if  nothing  else,  there's  always  that  pos- 
sibility. But  at  the  same  time,  there's  a  sense  that  both  sides  are  keeping 
accounts,  and  that,  unlike  what  happens  in  communism,  which  always 
partakes  of  a  certain  notion  of  eternity,  the  entire  relationship  can  be 
canceled  out,  and  either  party  can  call  an  end  to  it  at  any  time. 

This  element  of  competition  can  work  in  completely  different 
ways.  In  cases  of  barter  or  commercial  exchange,  when  both  parties  to 
the  transaction  are  only  interested  in  the  value  of  goods  being  trans- 
acted, they  may  well — as  economists  insist  they  should — try  to  seek  the 
maximum  material  advantage.  On  the  other  hand,  as  anthropologists 
have  long  pointed  out,  when  the  exchange  is  of  gifts,  that  is,  the  objects 
passing  back  and  forth  are  mainly  considered  interesting  in  how  they 
reflect  on  and  rearrange  relations  between  the  people  carrying  out  the 
transaction,  then  insofar  as  competition  enters  in,  it  is  likely  to  work 
precisely  the  other  way  around — to  become  a  matter  of  contests  of 
generosity,  of  people  showing  off  who  can  give  more  away. 

Let  me  take  these  one  at  a  time. 

What  marks  commercial  exchange  is  that  it's  "impersonal":  who  it 
is  that  is  selling  something  to  us,  or  buying  something  from  us,  should 
in  principle  be  entirely  irrelevant.  We  are  simply  comparing  the  value 
or  two  objects.  True,  as  with  any  principle,  in  practice,  this  is  rarely 
completely  true.  There  has  to  be  some  minimal  element  of  trust  for  a 
transaction  to  be  carried  out  at  all,  and,  unless  one  is  dealing  with  a 
vending  machine,  that  usually  requires  some  outward  display  of  social- 
ity. Even  in  the  most  impersonal  shopping  mall  or  supermarket,  clerks 
are  expected  to  at  least  simulate  personal  warmth,  patience,  and  other 
reassuring  qualities;  in  a  Middle-Eastern  bazaar,  one  might  have  to  go 
through  an  elaborate  process  of  establishing  a  simulated  friendship, 
sharing  tea,  food,  or  tobacco,  before  engaging  in  similarly  elaborate 



haggling — an  interesting  ritual  that  begins  by  establishing  sociality 
through  baseline  communism — and  continues  with  an  often  prolonged 
mock  battle  over  prices.  It's  all  done  on  the  basis  of  the  assumption 
that  buyer  and  seller  are,  at  least  at  that  moment,  friends  (and  thus 
each  entitled  to  feel  outraged  and  indignant  at  the  other's  unreasonable 
demands),  but  it's  all  a  little  piece  of  theater.  Once  the  object  changes 
hands,  there  is  no  expectation  that  the  two  will  ever  have  anything  to 
do  with  each  other  again.26 

Most  often  this  sort  of  haggling — in  Madagascar  the  term  for  it 
literally  means  "to  battle  out  a  sale"  {miady  varotra) — can  be  a  source 
of  pleasure  in  itself. 

The  first  time  I  visited  Analakely,  the  great  cloth  market  in  Mada- 
gascar's capital,  I  came  with  a  Malagasy  friend  intent  on  buying  a 
sweater.  The  whole  process  took  about  four  hours.  It  went  something 
like  this:  my  friend  would  spot  a  likely  sweater  hanging  in  some  booth, 
ask  the  price,  and  then  she  would  begin  a  prolonged  battle  of  wits  with 
the  vendor,  invariably  involving  dramatic  displays  of  insult  and  indig- 
nation, and  simulated  walkings  off  in  disgust.  Often  it  seemed  ninety 
percent  of  the  argument  was  spent  on  a  final,  tiny  difference  of  a  few 
ariary — literally,  pennies — that  seemed  to  become  a  profound  matter  of 
principle  on  either  side,  since  a  merchant's  failure  to  concede  it  could 
sink  the  entire  deal. 

The  second  time  I  visited  Analakely  I  went  with  another  friend, 
also  a  young  woman,  who  had  a  list  of  measures  of  cloth  to  buy  sup- 
plied by  her  sister.  At  each  booth  she  adopted  the  same  procedure:  she 
simply  walked  up  and  asked  for  the  price. 

The  man  would  quote  her  one. 

"All  right,"  she  then  asked,  "and  what's  your  real  final  price?" 
He'd  tell  her,  and  she'd  hand  over  the  money. 
"Wait  a  minute!"  I  asked.  "You  can  do  that? 
"Sure,"  she  said.  "Why  not?" 

I  explained  what  had  happened  with  my  last  friend. 

"Oh,  yeah,"  she  said.  "Some  people  enjoy  that  sort  of  thing." 

Exchange  allows  us  to  cancel  out  our  debts.  It  gives  us  a  way  to 
call  it  even:  hence,  to  end  the  relationship.  With  vendors,  one  is  usu- 
ally only  pretending  to  have  a  relationship  at  all.  With  neighbors, 
one  might  for  this  very  reason  prefer  not  to  pay  one's  debts.  Laura 
Bohannan  writes  about  arriving  in  a  Tiv  community  in  rural  Nigeria; 
neighbors  immediately  began  arriving  bearing  little  gifts:  "two  ears 
corn,  one  vegetable  marrow,  one  chicken,  five  tomatoes,  one  handful 
peanuts."27  Having  no  idea  what  was  expected  of  her,  she  thanked 
them  and  wrote  down  in  a  notebook  their  names  and  what  they  had 



brought.  Eventually,  two  women  adopted  her  and  explained  that  all 
such  gifts  did  have  to  be  returned.  It  would  be  entirely  inappropriate 
to  simply  accept  three  eggs  from  a  neighbor  and  never  bring  anything 
back.  One  did  not  have  to  bring  back  eggs,  but  one  should  bring  some- 
thing back  of  approximately  the  same  value.  One  could  even  bring 
money — there  was  nothing  inappropriate  in  that — provided  one  did 
so  at  a  discreet  interval,  and  above  all,  that  one  did  not  bring  the 
exact  cost  of  the  eggs.  It  had  to  be  either  a  bit  more  or  a  bit  less.  To 
bring  back  nothing  at  all  would  be  to  cast  oneself  as  an  exploiter  or  a 
parasite.  To  bring  back  an  exact  equivalent  would  be  to  suggest  that 
one  no  longer  wishes  to  have  anything  to  do  with  the  neighbor.  Tiv 
women,  she  learned,  might  spend  a  good  part  of  the  day  walking  for 
miles  to  distant  homesteads  to  return  a  handful  of  okra  or  a  tiny  bit  of 
change,  "in  an  endless  circle  of  gifts  to  which  no  one  ever  handed  over 
the  precise  value  of  the  object  last  received" — and  in  doing  so,  they 
were  continually  creating  their  society.  There  was  certainly  a  trace  of 
communism  here — neighbors  on  good  terms  could  also  be  trusted  to 
help  each  other  out  in  emergencies — but  unlike  communistic  relations, 
which  are  assumed  to  be  permanent,  this  sort  of  neighborliness  had  to 
be  constantly  created  and  maintained,  because  any  link  can  be  broken 
off  at  any  time. 

There  are  endless  variations  on  this  sort  of  tit-for-tat,  or  almost 
tit-for-tat,  gift  exchange.  The  most  familiar  is  the  exchange  of  presents: 
I  buy  someone  a  beer;  they  buy  me  the  next  one.  Perfect  equivalence 
implies  equality.  But  consider  a  slightly  more  complicated  example:  I 
take  a  friend  out  to  a  fancy  restaurant  for  dinner;  after  a  discreet  inter- 
val, they  do  the  same.  As  anthropologists  have  long  been  in  the  habit  of 
pointing  out,  the  very  existence  of  such  customs — especially,  the  feeling 
that  one  really  ought  to  return  the  favor — can't  be  explained  by  stan- 
dard economic  theory,  which  assumes  that  any  human  interaction  is 
ultimately  a  business  deal  and  that  we  are  all  self-interested  individuals 
trying  to  get  the  most  for  ourselves  for  the  least  cost  or  least  amount 
of  effort.28  But  this  feeling  is  quite  real,  and  it  can  cause  genuine  strain 
for  those  of  limited  means  trying  to  keep  up  appearances.  So:  Why, 
if  I  took  a  free-market  economic  theorist  out  to  an  expensive  dinner, 
would  that  economist  feel  somewhat  diminished — uncomfortably  in 
my  debt — until  he  had  been  able  to  return  the  favor?  Why,  if  he  were 
feeling  competitive  with  me,  would  he  be  inclined  to  take  me  to  some- 
place even  more  expensive? 

Recall  the  feasts  and  festivals  alluded  to  above:  here,  too,  there  is  a 
base  of  conviviality  and  playful  (sometimes  not  so  playful)  competition. 
On  the  one  hand,  everyone's  pleasure  is  enhanced — after  all,  how  many 



people  would  really  want  to  eat  a  superb  meal  at  a  French  restau- 
rant all  alone?  On  the  other,  things  can  easily  slip  into  games  of  one- 
upmanship — and  hence  obsession,  humiliation,  rage  .  .  .  or,  as  we'll 
soon  see,  even  worse.  In  some  societies,  these  games  are  formalized, 
but  it's  important  to  stress  that  such  games  only  really  develop  between 
people  or  groups  who  perceive  themselves  to  be  more  or  less  equivalent 
in  status.29  To  return  to  our  imaginary  economist:  it's  not  clear  that 
he  would  feel  diminished  if  he  received  a  present,  or  was  taken  out  to 
dinner,  by  just  anyone.  He  would  be  most  likely  to  feel  this  way  if  the 
benefactor  were  someone  he  felt  was  of  roughly  equivalent  status  or 
dignity:  a  colleague,  for  example.  If  Bill  Gates  or  George  Soros  took 
him  out  to  dinner,  he  would  likely  conclude  that  he  had  indeed  re- 
ceived something  for  nothing  and  leave  it  at  that.  If  some  ingratiating 
junior  colleague  or  eager  graduate  student  did  the  same,  he'd  be  likely 
to  conclude  that  he  was  doing  the  man  a  favor  just  by  accepting  the 
invitation — if  indeed  he  did  accept,  which  he  probably  wouldn't. 

This,  too,  appears  to  be  the  case  wherever  we  find  society  divided 
into  fine  gradations  of  status  and  dignity.  Pierre  Bourdieu  has  described 
the  "dialectic  of  challenge  and  riposte"  that  governs  all  games  of  honor 
among  Kabyle  Berber  men  in  Algeria,  in  which  the  exchange  of  insults, 
attacks  (in  feud  or  battles),  thefts,  or  threats  was  seen  to  follow  exactly 
the  same  logic  as  the  exchange  of  gifts.30  To  give  a  gift  is  both  an  honor 
and  a  provocation.  To  respond  to  one  requires  infinite  artistry.  Timing 
is  all-important.  So  is  making  the  counter-gift  just  different  enough,  but 
also  just  slightly  grander.  Above  all  is  the  tacit  moral  principle  that  one 
must  always  pick  on  someone  one's  own  size.  To  challenge  someone 
obviously  older,  richer,  and  more  honorable  is  to  risk  being  snubbed, 
and  hence  humiliated;  to  overwhelm  a  poor  but  respectable  man  with 
a  gift  he  couldn't  possibly  pay  back  is  simply  cruel,  and  will  do  equal 
damage  to  your  reputation.  There's  an  Indonesian  story  about  that  too: 
about  a  rich  man  who  sacrificed  a  magnificent  ox  to  shame  a  penurious 
rival;  the  poor  man  utterly  humiliated  him,  and  won  the  contest,  by 
calmly  proceeding  to  sacrifice  a  chicken.31 

Games  like  this  become  especially  elaborate  when  status  is  to  some 
degree  up  for  grabs.  When  matters  are  too  clear-cut,  that  introduces 
its  own  sorts  of  problems.  Giving  gifts  to  kings  is  often  a  particularly 
tricky  and  complicated  business.  The  problem  here  is  that  one  cannot 
really  give  a  gift  fit  for  a  king  (unless,  perhaps,  one  is  another  king), 
since  kings  by  definition  already  have  everything.  On  the  one  hand,  one 
is  expected  to  make  a  reasonable  effort: 



Nasruddin  was  once  called  up  to  visit  the  king.  A  neighbor  saw 
him  hurrying  along  the  road  carrying  a  bag  of  turnips. 
"What  are  those  for?"  he  asked. 

"I've  been  called  to  see  the  king.  I  thought  it  would  be  best 
to  bring  some  kind  of  present." 

"You're  bringing  him  turnips?  But  turnips  are  peasant  food! 
He's  a  king!  You  should  bring  him  something  more  appropri- 
ate, like  grapes." 

Nasruddin  agreed,  and  came  to  the  king  carrying  a  bunch  of 
grapes.  The  king  was  not  amused.  "You're  giving  me  grapes? 
But  I'm  a  king!  This  is  ridiculous.  Take  this  idiot  out  and  teach 
him  some  manners!  Throw  each  and  every  one  of  the  grapes  at 
him  and  then  kick  him  out  of  the  palace." 

The  emperor's  guards  dragged  Nasruddin  into  a  side  room 
and  began  pelting  him  with  grapes.  As  they  did  so,  he  fell  on 
his  knees  and  began  crying,  "Thank  you,  thank  you  God,  for 
your  infinite  mercy!" 

"Why  are  you  thanking  God?"  they  asked.  "You're  being 
totally  humiliated!" 

Nasruddin  replied,  "Oh,  I  was  just  thinking,  'Thank  God  I 
didn't  bring  the  turnips!'" 

On  the  other  hand,  to  give  something  that  a  king  does  not  already 
have  can  get  you  in  even  greater  trouble.  One  story  circulating  in  the 
early  Roman  Empire  concerned  an  inventor  who,  with  great  fanfare, 
presented  a  glass  bowl  as  a  gift  to  the  emperor  Tiberius.  The  emperor 
was  puzzled:  What  was  so  impressive  about  a  piece  of  glass?  The  man 
dropped  it  on  the  ground.  Rather  than  shattering,  it  merely  dented.  He 
picked  it  up  and  simply  pushed  it  back  into  its  former  shape. 

"Did  you  tell  anyone  else  how  you  made  this  thing?"  asked  a 
startled  Tiberius. 

The  inventor  assured  him  that  he  had  not.  The  emperor  therefore 
ordered  him  killed,  since,  if  word  of  how  to  make  unbreakable  glass 
got  out,  his  treasury  of  gold  and  silver  would  soon  be  worthless.32 

The  best  bet  when  dealing  with  kings  was  to  make  a  reason- 
able effort  to  play  the  game,  but  one  that  is  still  bound  to  fail.  The 
fourteenth-century  Arab  traveler  Ibn  Battuta  tells  of  the  customs  of 
the  King  of  Sind,  a  terrifying  monarch  who  took  a  particular  delight 
in  displays  of  arbitrary  power.33  It  was  customary  for  foreign  worthies 
visiting  the  king  to  present  him  with  magnificent  presents;  whatever 
the  gift  was,  he  would  invariably  respond  by  presenting  the  bearer 
with  something  many  times  its  value.  As  a  result,  a  substantial  business 



developed  where  local  bankers  would  lend  money  to  such  visitors  to 
finance  particularly  spectacular  gifts,  knowing  they  could  be  well  re- 
paid from  the  proceeds  of  royal  one-upmanship.  The  king  must  have 
known  about  this.  He  didn't  object — since  the  whole  point  was  to 
show  that  his  wealth  exceeded  all  possible  equivalence — and  if  he  re- 
ally needed  to,  he  could  always  expropriate  the  bankers.  They  knew 
that  the  really  important  game  was  not  economic,  but  one  of  status, 
and  his  was  absolute. 

In  exchange,  the  objects  being  traded  are  seen  as  equivalent.  There- 
fore, by  implication,  so  are  the  people:  at  least,  at  the  moment  when 
gift  is  met  with  counter-gift,  or  money  changes  hands;  when  there  is 
no  further  debt  or  obligation  and  each  of  the  two  parties  is  equally 
free  to  walk  away.  This  in  turn  implies  autonomy.  Both  principles  sit 
uncomfortably  with  monarchs,  which  is  the  reason  that  kings  generally 
dislike  any  sort  of  exchange.34  But  within  that  overhanging  prospect  of 
potential  cancellation,  of  ultimate  equivalence,  we  find  endless  varia- 
tions, endless  games  one  can  play.  One  can  demand  something  from 
another  person,  knowing  that  by  doing  so,  one  is  giving  the  other  the 
right  to  demand  something  of  equivalent  value  in  return.  In  some  con- 
texts, even  praising  another's  possession  might  be  interpreted  as  a  de- 
mand of  this  sort.  In  eighteenth-century  New  Zealand,  English  settlers 
soon  learned  that  it  was  not  a  good  idea  to  admire,  say,  a  particularly 
beautiful  jade  pendant  worn  around  the  neck  of  a  Maori  warrior;  the 
latter  would  inevitably  insist  on  giving  it,  not  take  no  for  an  answer, 
and  then,  after  a  discreet  interval,  return  to  praise  the  settler's  coat 
or  gun.  The  only  way  to  head  this  off  was  to  quickly  give  him  a  gift 
before  he  could  ask  for  one.  Sometimes  gifts  are  offered  in  order  for 
the  giver  to  be  able  to  make  such  a  demand:  if  one  accepts  the  present, 
one  is  tacitly  agreeing  to  allow  the  giver  to  claim  whatever  he  deems 

All  this,  in  turn,  can  shade  into  something  very  much  like  barter, 
directly  swapping  one  thing  for  another — which  as  we've  seen  does 
occur  even  in  what  Marcel  Mauss  liked  to  refer  to  as  "gift  econo- 
mies," even  if  largely  between  strangers.16  Within  communities,  there 
is  almost  always  a  reluctance,  as  the  Tiv  example  so  nicely  illustrates, 
to  allow  things  to  cancel  out — one  reason  that  if  there  is  money  in 
common  usage,  people  will  often  either  refuse  to  use  it  with  friends  or 
relatives  (which  in  a  village  society  includes  pretty  much  everyone),  or 
alternately,  like  the  Malagasy  villagers  in  chapter  3,  use  it  in  radically 
different  ways. 




Exchange,  then,  implies  formal  equality — or  at  least,  the  potential  for 
it.  This  is  precisely  why  kings  have  such  trouble  with  it. 

In  contrast,  relations  of  explicit  hierarchy — that  is,  relations  be- 
tween at  least  two  parties  in  which  one  is  considered  superior  to  the 
other — do  not  tend  to  operate  by  reciprocity  at  all.  It's  hard  to  see 
because  the  relation  is  often  justified  in  reciprocal  terms  ("the  peas- 
ants provide  food,  the  lords  provide  protection"),  but  the  principle  by 
which  they  operate  is  exactly  the  opposite.  In  practice,  hierarchy  tends 
to  work  by  a  logic  of  precedent. 

To  illustrate  what  I  mean  by  this,  let  us  imagine  a  kind  of  con- 
tinuum of  one-sided  social  relations,  ranging  from  the  most  exploit- 
ative to  the  most  benevolent.  At  one  extreme  is  theft,  or  plunder;  on 
the  other  selfless  charity.37  Only  at  these  two  extremes  is  it  is  possible 
to  have  material  interactions  between  people  who  otherwise  have  no 
social  relation  of  any  kind.  Only  a  lunatic  would  mug  his  next-door 
neighbor.  A  band  of  marauding  soldiers  or  nomadic  horsemen  falling 
on  a  peasant  hamlet  to  rape  and  pillage  also  obviously  have  no  inten- 
tion of  forming  any  ongoing  relations  with  the  survivors.  But  in  a 
similar  way,  religious  traditions  often  insist  that  the  only  true  charity  is 
anonymous — in  other  words,  not  meant  to  place  the  recipient  in  one's 
debt.  One  extreme  form  of  this,  documented  in  various  parts  of  the 
world,  is  the  gift  by  stealth,  in  a  kind  of  reverse  burglary:  to  literally 
sneak  into  the  recipient's  house  at  night  and  plant  one's  present  so  no 
one  can  know  for  sure  who  has  left  it.  The  figure  of  Santa  Claus,  or 
Saint  Nicholas  (who,  it  must  be  remembered,  was  not  just  the  patron 
saint  of  children,  but  also  the  patron  saint  of  thieves)  would  appear  to 
be  the  mythological  version  of  the  same  principle:  a  benevolent  burglar 
with  whom  no  social  relations  are  possible  and  therefore  to  whom  no 
one  could  possibly  owe  anything,  in  his  case,  above  all,  because  he  does 
not  actually  exist. 

Observe,  however,  what  happens  when  one  moves  just  a  little  bit 
less  far  out  on  the  continuum  in  either  direction.  I  have  been  told  (I 
suspect  it  isn't  true)  that  in  parts  of  Belarus,  gangs  prey  so  systemati- 
cally on  travelers  on  trains  and  busses  that  they  have  developed  the 
habit  of  giving  each  victim  a  little  token,  to  confirm  that  the  bearer  has 
already  been  robbed.  Obviously  one  step  toward  the  creation  of  a  state. 
Actually,  one  popular  theory  of  the  origins  of  the  state,  that  goes  back 
at  least  to  the  fourteenth-century  North  African  historian  Ibn  Khaldun, 
runs  precisely  along  these  lines:  nomadic  raiders  eventually  systematize 



their  relations  with  sedentary  villagers;  pillage  turns  into  tribute,  rape 
turns  into  the  "right  of  the  first  night"  or  the  carrying  off  of  likely  can- 
didates as  recruits  for  the  royal  harem.  Conquest,  untrammeled  force, 
becomes  systematized,  and  thus  framed  not  as  a  predatory  relation  but 
as  a  moral  one,  with  the  lords  providing  protection,  and  the  villagers, 
their  sustenance.  But  even  if  all  parties  assume  they  are  operating  by  a 
shared  moral  code,  that  even  kings  cannot  do  whatever  they  want  but 
must  operate  within  limits,  allowing  peasants  to  argue  about  the  rights 
and  wrongs  of  just  how  much  of  their  harvest  a  king's  retainers  are 
entitled  to  carry  off,  they  are  very  unlikely  to  frame  their  calculation  in 
terms  of  the  quality  or  quantity  of  protection  provided,  but  rather  in 
terms  of  custom  and  precedent:  How  much  did  we  pay  last  year?  How 
much  did  our  ancestors  have  to  pay?  The  same  is  true  on  the  other 
side.  If  charitable  donations  become  the  basis  for  any  sort  of  social 
relation,  it  will  not  be  one  based  on  reciprocity.  If  you  give  some  coins 
to  a  panhandler,  and  that  panhandler  recognizes  you  later,  it  is  unlikely 
that  he  will  give  you  any  money — but  he  might  well  consider  you  more 
likely  to  give  him  money  again.  Certainly  this  is  true  if  one  donates 
money  to  a  charitable  organization.  (I  gave  money  to  the  United  Farm 
Workers  once  and  I  still  haven't  heard  the  end  of  it.)  Such  an  act  of 
one-sided  generosity  is  treated  as  a  precedent  for  what  will  be  expected 
afterward.38  It's  quite  the  same  if  one  gives  candy  to  a  child. 

This  is  what  I  mean  when  I  say  that  hierarchy  operates  by  a  prin- 
ciple that  is  the  very  opposite  of  reciprocity.  Whenever  the  lines  of  su- 
periority and  inferiority  are  clearly  drawn  and  accepted  by  all  parties  as 
the  framework  of  a  relationship,  and  relations  are  sufficiently  ongoing 
that  we  are  no  longer  simply  dealing  with  arbitrary  force,  then  relations 
will  be  seen  as  being  regulated  by  a  web  of  habit  or  custom.  Sometimes 
the  situation  is  assumed  to  have  originated  in  some  founding  act  of 
conquest.  Or  it  might  been  seen  as  ancestral  custom  for  which  there  is 
no  need  of  explanation.  But  this  introduces  another  complication  to  the 
problem  of  giving  gifts  to  kings — or  to  any  superior:  there  is  always  the 
danger  that  it  will  be  treated  as  a  precedent,  added  to  the  web  of  cus- 
tom, and  therefore  considered  obligatory  thereafter.  Xenophon  claims 
that  in  the  early  days  of  the  Persian  Empire,  each  province  vied  to  send 
the  Great  King  gifts  of  its  most  unique  and  valuable  products.  This 
became  the  basis  of  the  tribute  system:  each  province  was  eventually 
expected  to  provide  the  same  "gifts"  every  year."  Similarly,  according 
to  the  great  Medieval  historian  Marc  Bloch: 

[I]n  the  ninth  century,  when  one  day  there  was  a  shortage  of 
wine  in  the  royal  cellars  at  Ver,  the  monks  of  Saint-Denis  were 



asked  to  supply  the  two  hundred  hogs-heads  required.  This 
contribution  was  thenceforth  claimed  from  them  as  of  right 
every  year,  and  it  required  an  imperial  charter  to  abolish  it.  At 
Ardres,  we  are  told,  there  was  once  a  bear,  the  property  of  the 
local  lord.  The  inhabitants,  who  loved  to  watch  it  fight  with 
dogs,  undertook  to  feed  it.  The  beast  eventually  died,  but  the 
lord  continued  to  exact  the  loaves  of  bread."40 

In  other  words,  any  gift  to  a  feudal  superior,  "especially  if  repeated 
three  of  four  times,"  was  likely  to  be  treated  as  a  precedent  and  added 
to  the  web  of  custom.  As  a  result,  those  giving  gifts  to  superiors  often 
insisted  on  receiving  a  "letter  of  non-prejudice"  legally  stipulating  that 
such  a  gift  would  not  be  required  in  the  future.  While  it  is  unusual  for 
matters  to  become  quite  so  formalized,  any  social  relation  that  is  as- 
sumed from  the  start  to  be  unequal  will  inevitably  begin  to  operate  on 
an  analogous  logic — if  only  because,  once  relations  are  seen  as  based 
on  "custom,"  the  only  way  to  demonstrate  that  one  has  a  duty  or  obli- 
gation to  do  something  is  to  show  that  one  has  done  it  before. 

Often,  such  arrangements  can  turn  into  a  logic  of  caste:  certain 
clans  are  responsible  for  weaving  the  ceremonial  garments,  or  bringing 
the  fish  for  royal  feasts,  or  cutting  the  king's  hair.  They  thus  come  to 
be  known  as  weavers  or  fishermen  or  barbers.41  This  last  point  can't  be 
overemphasized  because  it  brings  home  another  truth  regularly  over- 
looked: that  the  logic  of  identity  is,  always  and  everywhere,  entangled 
in  the  logic  of  hierarchy.  It  is  only  when  certain  people  are  placed 
above  others,  or  where  everyone  is  being  ranked  in  relation  to  the 
king,  or  the  high  priest,  or  Founding  Fathers,  that  one  begins  to  speak 
of  people  bound  by  their  essential  nature:  about  fundamentally  differ- 
ent kinds  of  human  being.  Ideologies  of  caste  or  race  are  just  extreme 
examples.  It  happens  whenever  one  group  is  seen  as  raising  themselves 
above  others,  or  placing  themselves  below  others,  in  such  a  way  that 
ordinary  standards  of  fair  dealing  no  longer  apply. 

In  fact,  something  like  this  happens  in  a  small  way  even  in  our 
most  intimate  social  relations.  The  moment  we  recognize  someone  as  a 
different  sort  of  person,  either  above  or  below  us,  then  ordinary  rules 
of  reciprocity  become  modified  or  are  set  aside.  If  a  friend  is  unusually 
generous  once,  we  will  likely  wish  to  reciprocate.  If  she  acts  this  way 
repeatedly,  we  conclude  she  is  a  generous  person,  and  are  hence  less 
likely  to  reciprocate.42 

We  can  describe  a  simple  formula  here:  a  certain  action,  repeated, 
becomes  customary;  as  a  result,  it  comes  to  define  the  actor's  essential 
nature.  Alternately,  a  person's  nature  may  be  defined  by  how  others 



have  acted  toward  him  in  the  past.  To  be  an  aristocrat  is  largely  to 
insist  that  in  the  past,  others  have  treated  you  as  an  aristocrat  (since 
aristocrats  don't  really  do  anything  in  particular,  most  spend  their  time 
simply  existing  in  some  sort  of  putatively  superior  state),  and  therefore 
should  continue  to  do  so.  Much  of  the  art  of  being  such  a  person  is  that 
of  treating  oneself  in  such  a  manner  that  it  conveys  how  you  expect 
others  to  treat  you:  in  the  case  of  actual  kings,  covering  oneself  with 
gold  so  as  to  suggest  that  others  do  likewise.  On  the  other  end  of  the 
scale,  this  is  also  how  abuse  becomes  self-legitimating.  As  a  former 
student  of  mine,  Sarah  Stillman,  pointed  out:  in  the  United  States,  if 
a  middle-class  thirteen-year-old  girl  is  kidnapped,  raped,  and  killed, 
it  is  considered  an  agonizing  national  crisis  that  everyone  with  a  tele- 
vision is  expected  to  follow  for  several  weeks.  If  a  thirteen-year-old 
girl  is  turned  out  as  a  child  prostitute,  raped  systematically  for  years, 
and  ultimately  killed,  all  this  is  considered  unremarkable — really  just 
the  sort  of  thing  one  can  expect  to  end  up  happening  to  someone 
like  that.43 

When  objects  of  material  wealth  pass  back  and  forth  between  su- 
periors and  inferiors  as  gifts  or  payments,  the  key  principle  seems  to 
be  that  the  sorts  of  things  given  on  each  side  should  be  considered 
fundamentally  different  in  quality,  their  relative  value  impossible  to 
quantify — the  result  being  that  there  is  no  way  to  even  conceive  of  a 
squaring  of  accounts.  Even  if  Medieval  writers  insisted  on  imagining 
society  as  a  hierarchy  in  which  priests  pray  for  everyone,  nobles  fight 
for  everyone,  and  peasants  feed  everyone,  it  never  even  occurred  to 
anyone  to  establish  how  many  prayers  or  how  much  military  protec- 
tion was  equivalent  to  a  ton  of  wheat.  Nor  did  anyone  ever  consider 
making  such  a  calculation.  Neither  is  it  that  "lowly"  sorts  of  people  are 
necessarily  given  lowly  sorts  of  things  and  vice  versa.  Sometimes  it  is 
quite  the  opposite.  Until  recently,  just  about  any  notable  philosopher, 
artist,  poet,  or  musician  was  required  to  find  a  wealthy  patron  for 
support.  Famous  works  of  poetry  or  philosophy  are  often  prefaced — 
oddly,  to  the  modern  eye — with  gushing,  sycophantic  praise  for  the 
wisdom  and  virtue  of  some  long-forgotten  earl  or  count  who  provided 
a  meager  stipend.  The  fact  that  the  noble  patron  merely  provided 
room  and  board,  or  money,  and  that  the  client  showed  his  gratitude 
by  painting  the  Mona  Lisa,  or  composing  the  Toccata  and  Fugue  in 
D  Minor,  was  in  no  way  seen  to  compromise  the  assumption  of  the 
noble's  intrinsic  superiority. 

There  is  one  great  exception  to  this  principle,  and  that  is  the  phe- 
nomenon of  hierarchical  redistribution.  Here,  though,  rather  than  giv- 
ing back  and  forth  the  same  sorts  of  things,  they  give  back  and  forth 



exactly  the  same  thing:  as,  for  instance,  when  fans  of  certain  Nigerian 
pop  stars  throw  money  onto  the  stage  during  concerts,  and  the  pop 
stars  in  question  make  occasional  tours  of  their  fans'  neighborhoods 
tossing  (the  same)  money  from  the  windows  of  their  limos.  When  this 
is  all  that's  going  on,  we  may  speak  of  an  absolutely  minimal  sort  of 
hierarchy.  In  much  of  Papua  New  Guinea,  social  life  centers  on  "big 
men,"  charismatic  individuals  who  spend  much  of  their  time  coaxing, 
cajoling,  and  manipulating  in  order  to  acquire  masses  of  wealth  to  give 
away  again  at  some  great  feast.  One  could,  in  practice,  pass  from  here 
to,  say,  an  Amazonian  or  indigenous  North  American  chief.  Unlike 
big  men,  their  role  is  more  formalized;  but  actually  such  chiefs  have 
no  power  to  compel  anyone  to  do  anything  they  don't  want  to  (hence 
North  American  Indian  chiefs'  famous  skill  at  oratory  and  powers  of 
persuasion).  As  a  result,  they  tended  to  give  away  far  more  than  they 
received.  Observers  often  remarked  that  in  terms  of  personal  posses- 
sions, a  village  chief  was  often  the  poorest  man  in  the  village,  such  was 
the  pressure  on  him  for  constant  supply  of  largesse. 

Indeed,  one  could  judge  how  egalitarian  a  society  really  was  by  ex- 
actly this:  whether  those  ostensibly  in  positions  of  authority  are  merely 
conduits  for  redistribution,  or  able  to  use  their  positions  to  accumulate 
riches.  The  latter  seems  most  likely  in  aristocratic  societies  that  add 
another  element:  war  and  plunder.  After  all,  just  about  anyone  who 
comes  into  a  very  large  amount  of  wealth  will  ultimately  give  at  least 
part  of  it  away — often  in  grandiose  and  spectacular  ways  to  large  num- 
bers of  people.  The  more  of  one's  wealth  is  obtained  by  plunder  or 
extortion,  the  more  spectacular  and  self-aggrandizing  will  be  the  forms 
in  which  it's  given  away.44  And  what  is  true  of  warrior  aristocracies 
is  all  the  more  true  of  ancient  states,  where  rulers  almost  invariably 
represented  themselves  as  the  protectors  of  the  helpless,  supporters  of 
widows  and  orphans,  and  champions  of  the  poor.  The  genealogy  of 
the  modern  redistributive  state — with  its  notorious  tendency  to  foster 
identity  politics — can  be  traced  back  not  to  any  sort  of  "primitive  com- 
munism" but  ultimately  to  violence  and  war. 

Shifting  between  Modalities 

I  should  underline  again  that  we  are  not  talking  about  different  types 
of  society  here  (as  we've  seen,  the  very  idea  that  we've  ever  been  or- 
ganized into  discrete  "societies"  is  dubious)  but  moral  principles  that 
always  coexist  everywhere.  We  are  all  communists  with  'our  closest 



friends,  and  feudal  lords  when  dealing  with  small  children.  It  is  very 
hard  to  imagine  a  society  where  people  wouldn't  be  both. 

The  obvious  question  is:  If  we  are  all  ordinarily  moving  back  and 
forth  between  completely  different  systems  of  moral  accounting,  why 
hasn't  anybody  noticed  this?  Why,  instead,  do  we  continually  feel  the 
need  to  reframe  everything  in  terms  of  reciprocity? 

Here  we  must  return  to  the  fact  that  reciprocity  is  our  main  way  of 
imagining  justice.  In  particular,  it  is  what  we  fall  back  on  when  we're 
thinking  in  the  abstract,  and  especially  when  we're  trying  to  create  an 
idealized  picture  of  society.  I've  already  given  examples  of  this  sort  of 
thing.  Iroquois  communities  were  based  on  an  ethos  that  required  ev- 
eryone to  be  attentive  to  the  needs  of  several  different  sorts  of  people: 
their  friends,  their  families,  members  of  their  matrilineal  clans,  even 
friendly  strangers  in  situations  of  hardship.  It  was  when  they  had  to 
think  about  society  in  the  abstract  that  they  started  to  emphasize  the 
two  sides  of  the  village,  each  of  which  had  to  bury  the  other's  dead. 
It  was  a  way  of  imagining  communism  through  reciprocity.  Similarly, 
feudalism  was  a  notoriously  messy  and  complicated  business,  but  when- 
ever Medieval  thinkers  generalized  about  it,  they  reduced  all  its  ranks 
and  orders  into  one  simple  formula  in  which  each  order  contributed  its 
share:  "Some  pray,  some  fight,  still  others  work."45  Even  hierarchy  was 
seen  as  ultimately  reciprocal,  despite  this  formula  having  nothing  to 
do  with  the  real  relations  between  priests,  knights,  and  peasants  really 
operated  on  the  ground.  Anthropologists  are  familiar  with  the  phe- 
nomenon: it's  only  when  people  who  have  never  had  occasion  to  really 
think  about  their  society  or  culture  as  a  whole,  who  probably  weren't 
even  aware  they  were  living  inside  something  other  people  considered 
a  "society"  or  a  "culture,"  are  asked  to  explain  how  everything  works 
that  they  say  things  like  "this  is  how  we  repay  our  mothers  for  the  pain 
of  having  raised  us,"  or  puzzle  over  conceptual  diagrams  in  which  clan 
A  gives  their  women  in  marriage  to  clan  B  who  gives  theirs  to  clan  C, 
who  gives  theirs  back  to  A  again,  but  which  never  seem  to  quite  cor- 
respond to  what  real  people  actually  do.46  When  trying  to  imagine  a 
just  society,  it's  hard  not  to  evoke  images  of  balance  and  symmetry,  of 
elegant  geometries  where  everything  balances  out. 

The  idea  that  there  is  something  called  "the  market"  is  not  so  very 
different.  Economists  will  often  admit  this,  if  you  ask  them  in  the  right 
way.  Markets  aren't  real.  They  are  mathematical  models,  created  by 
imagining  a  self-contained  world  where  everyone  has  exactly  the  same 
motivation  and  the  same  knowledge  and  is  engaging  in  the  same  self- 
interested  calculating  exchange.  Economists  are  aware  that  reality  is 
always  more  complicated;  but  they  are  also  aware  that  to  come  up  with 



a  mathematical  model,  one  always  has  to  make  the  world  into  a  bit  of 
a  cartoon.  There's  nothing  wrong  with  this.  The  problem  comes  when 
it  enables  some  (often  these  same  economists)  to  declare  that  anyone 
who  ignores  the  dictates  of  the  market  shall  surely  be  punished — or 
that  since  we  live  in  a  market  system,  everything  (except  government 
interference)  is  based  on  principles  of  justice:  that  our  economic  system 
is  one  vast  network  of  reciprocal  relations  in  which,  in  the  end,  the 
accounts  balance  and  all  debts  are  paid. 

These  principles  get  tangled  up  in  each  other  and  it's  thus  often 
difficult  to  tell  which  predominates  in  a  given  situation — one  reason 
that  it's  ridiculous  to  pretend  we  could  ever  reduce  human  behavior, 
economic  or  otherwise,  to  a  mathematical  formula  of  any  sort.  Still, 
this  means  that  some  degree  of  reciprocity  can  be  detected  as  poten- 
tially present  in  any  situation;  so  a  determined  observer  can  always  find 
some  excuse  to  say  it's  there.  What's  more,  certain  principles  appear 
to  have  an  inherent  tendency  to  slip  into  others.  For  instance,  a  lot  of 
extremely  hierarchical  relationships  can  operate  (at  least  some  of  the 
time)  on  communistic  principles.  If  you  have  a  rich  patron,  you  come 
to  him  in  times  of  need,  and  he  is  expected  to  help  you.  But  only  to  a 
certain  degree.  No  one  expects  the  patron  to  provide  so  much  help  that 
it  threatens  to  undermine  the  underlying  inequality.47 

Likewise,  communistic  relations  can  easily  start  slipping  into  rela- 
tions of  hierarchical  inequality — often  without  anyone  noticing  it.  It's 
not  hard  to  see  why  this  happens.  Sometimes  different  people's  "abili- 
ties" and  "needs"  are  grossly  disproportionate.  Genuinely  egalitarian 
societies  are  keenly  aware  of  this  and  tend  to  develop  elaborate  safe- 
guards around  the  dangers  of  anyone — say,  especially  good  hunters,  in 
a  hunting  society — rising  too  far  above  themselves;  just  as  they  tend 
to  be  suspicious  of  anything  that  might  make  one  member  of  the  so- 
ciety feel  in  genuine  debt  to  another.  A  member  who  draws  attention 
to  his  own  accomplishments  will  find  himself  the  object  of  mockery. 
Often,  the  only  polite  thing  to  do  if  one  has  accomplished  something 
significant  is  to  instead  make  fun  of  oneself.  The  Danish  writer  Peter 
Freuchen,  in  his  Book  of  the  Eskimo,  described  how  in  Greenland,  one 
could  tell  what  a  fine  delicacy  someone  had  to  offer  his  guests  by  how 
much  he  belittled  it  beforehand: 

The  old  man  laughed.  "Some  people  don't  know  much.  I  am 
such  a  poor  hunter  and  my  wife  a  terrible  cook  who  ruins 
everything.  I  don't  have  much,  but  I  think  there  is  a  piece  of 
meat  outside.  It  might  still  be  there  as  the  dogs  have  refused  it 
several  times." 



This  was  such  a  recommendation  in  the  Eskimo  way  of 
backwards  bragging  that  everyone's  mouths  began  to  water  .  .  . 

The  reader  will  recall  the  walrus  hunter  of  the  last  chapter,  who 
took  offense  when  the  author  tried  to  thank  him  for  giving  him  a  share 
of  meat — after  all,  humans  help  one  another,  and  once  we  treat  some- 
thing as  a  gift,  we  turn  into  something  less  than  human:  "Up  here  we 
say  that  by  gifts  one  makes  slaves  and  by  whips  one  makes  dogs."48 

"Gift"  here  does  not  mean  something  given  freely,  not  mutual  aid 
that  we  can  ordinarily  expect  human  beings  to  provide  to  one  another. 
To  thank  someone  suggests  that  he  or  she  might  not  have  acted  that 
way,  and  that  therefore  the  choice  to  act  this  way  creates  an  obliga- 
tion, a  sense  of  debt — and  hence,  inferiority.  Communes  or  egalitarian 
collectives  in  the  United  States  often  face  similar  dilemmas,  and  they 
have  to  come  up  with  their  own  safeguards  against  creeping  hierar- 
chy. It's  not  that  the  tendency  for  communism  to  slip  into  hierarchy 
is  inevitable — societies  like  the  Inuit  have  managed  to  fend  it  off  for 
thousands  of  years — but  rather,  that  one  must  always  guard  against  it. 

In  contrast,  it's  notoriously  difficult — often  downright  impossible — 
to  shift  relations  based  on  an  assumption  of  communistic  sharing  to 
relations  of  equal  exchange.  We  observe  this  all  the  time  with  friends:  if 
someone  is  seen  as  taking  advantage  of  your  generosity,  it's  often  much 
easier  to  break  off  relations  entirely  than  to  demand  that  they  some- 
how pay  you  back.  One  extreme  example  is  the  Maori  story  about  a 
notorious  glutton  who  used  to  irritate  fishermen  up  and  down  the  coast 
near  where  he  lived  by  constantly  asking  for  the  best  portions  of  their 
catch.  Since  to  refuse  a  direct  request  for  food  was  effectively  impos- 
sible, they  would  dutifully  turn  it  over;  until  one  day,  people  decided 
enough  was  enough  and  killed  him.49 

We've  already  seen  how  creating  a  ground  of  sociability  among 
strangers  can  often  require  an  elaborate  process  of  testing  the  oth- 
ers' limits  by  helping  oneself  to  their  possessions.  The  same  sort  of 
thing  can  happen  in  peacemaking,  or  even  in  the  creation  of  business 
partnerships.50  In  Madagascar,  people  told  me  that  two  men  who  are 
thinking  of  going  into  business  together  will  often  become  blood  broth- 
ers. Blood  brotherhood,  fatidra,  consists  of  an  unlimited  promise  of 
mutual  aid.  Both  parties  solemnly  swear  that  they  will  never  refuse  any 
request  from  the  other.  In  reality,  partners  to  such  an  agreement  are 
usually  fairly  circumspect  in  what  they  actually  request.  But,  my  friends 
insisted,  when  people  first  make  such  an  agreement,  they  sometimes 
like  to  test  it  out.  One  may  demand  the  other's  house,  the  shirt  off 
his  back,  or  (everyone's  favorite  example)  the  right  to  spend  the  night 



with  his  wife.  The  only  limit  is  the  knowledge  that  anything  one  can 
demand,  the  other  one  can  too.51  Here,  again,  we  are  talking  about  an 
initial  establishment  of  trust.  Once  the  genuineness  of  the  mutual  com- 
mitment has  been  confirmed,  the  ground  is  prepared,  as  it  were,  and 
the  two  men  can  begin  to  buy  and  sell  on  consignment,  advance  funds, 
share  profits,  and  otherwise  trust  that  each  will  look  after  the  other's 
commercial  interests  from  then  on.  The  most  famous  and  dramatic 
moments,  however,  are  those  when  relations  of  exchange  threaten  to 
break  down  into  hierarchy:  that  is,  when  two  parties  are  acting  like 
equals,  trading  gifts,  or  blows,  or  commodities,  or  anything  else,  but 
one  of  them  does  something  that  completely  flips  the  scale. 

I've  already  mentioned  the  tendency  of  gift  exchange  to  turn  into 
games  of  one-upmanship,  and  how  in  some  societies  this  potential  is 
formalized  in  great  public  contests.  This  is  typical,  above  all,  of  what 
are  often  called  "heroic  societies":  those  in  which  governments  are 
weak  or  nonexistent  and  society  is  organized  instead  around  warrior 
noblemen,  each  with  his  entourage  of  loyal  retainers  and  tied  to  the 
others  by  ever-shifting  alliances  and  rivalries.  Most  epic  poetry — from 
the  Iliad  to  the  Mahabharata  to  Beowulf — harkens  back  to  this  sort 
of  world,  and  anthropologists  have  discovered  similar  arrangements 
among  the  Maori  of  New  Zealand  and  the  Kwakiutl,  Tlingit,  and 
Haida  of  the  American  Northwest  coast.  In  heroic  societies,  the  throw- 
ing of  feasts  and  resulting  contests  of  generosity  are  often  spoken  of 
as  mere  extensions  of  war:  "fighting  with  property"  or  "fighting  with 
food."  Those  who  throw  such  feasts  often  indulge  in  colorful  speeches 
about  how  their  enemies  are  thus  crushed  and  destroyed  by  glorious 
feats  of  generosity  aimed  in  their  direction  (Kwakiutl  chiefs  liked  to 
speak  of  themselves  as  great  mountains  from  which  gifts  rolled  like  gi- 
ant boulders),  and  of  how  conquered  rivals  are  thus  reduced — much  as 
in  the  Inuit  metaphor — to  slaves. 

Such  statements  are  not  to  be  taken  literally — another  feature  of 
such  societies  is  a  highly  developed  art  of  boasting.52  Heroic  chiefs  and 
warriors  tended  to  talk  themselves  up  just  as  consistently  as  those  in 
egalitarian  societies  talked  themselves  down.  It's  not  as  if  someone  who 
loses  out  in  a  contest  of  gift  exchange  is  ever  actually  reduced  to  slav- 
ery, but  he  might  end  up  feeling  as  if  he  were.  And  the  consequences 
could  be  catastrophic.  One  ancient  Greek  source  describes  Celtic  fes- 
tivals where  rival  nobles  would  alternate  between  jousts  and  contests 
of  generosity,  presenting  their  enemies  with  magnificent  gold  and  silver 
treasures.  Occasionally  this  could  lead  to  a  kind  of  checkmate;  some- 
one would  be  faced  with  a  present  so  magnificent  that  he  could  not 
possibly  match  it.  In  this  case,  the  only  honorable  response  was  for  him 



to  cut  his  own  throat,  thus  allowing  his  wealth  to  be  distributed  to  his 
followers.53  Six  hundred  years  later,  we  find  a  case  from  an  Icelandic 
saga  of  an  aging  Viking  named  Egil,  who  befriended  a  younger  man 
named  Einar,  who  was  still  actively  raiding.  They  liked  to  sit  together 
composing  poetry.  One  day  Einar  came  by  a  magnificent  shield  "in- 
scribed with  old  tales;  and  between  the  writing  were  overlaid  spangles 
of  gold  with  precious  stones."  No  one  had  ever  seen  anything  like  it. 
He  took  it  with  him  on  a  visit  to  Egil.  Egil  was  not  at  home,  so  Einar 
waited  three  days,  as  was  the  custom,  then  hung  the  shield  as  a  present 
in  the  mead-hall  and  rode  off. 

Egil  returned  home,  saw  the  shield,  and  asked  who  owned 
such  a  treasure.  He  was  told  that  Einar  had  visited  and  given 
it  to  him.  Then  Egil  said,  "To  hell  with  him!  Does  he  think 
I'm  going  to  stay  up  all  night  and  compose  a  poem  about  his 
shield?  Get  my  horse,  I'm  going  to  ride  after  him  and  kill  him." 
As  Einar's  luck  would  have  it  he  had  left  early  enough  to  put 
sufficient  distance  between  himself  and  Egil.  So  Egil  resigned 
himself  to  composing  a  poem  about  Einar's  gift.14 

Competitive  gift  exchange,  then,  does  not  literally  render  anyone  slaves; 
it  is  simply  an  affair  of  honor.  These  are  people,  however,  for  whom 
honor  is  everything. 

The  main  reason  that  being  unable  to  pay  a  debt,  especially  a  debt 
of  honor,  was  such  a  crisis  was  because  this  was  how  noblemen  as- 
sembled their  entourages.  The  law  of  hospitality  in  the  ancient  world, 
for  instance,  insisted  that  any  traveler  must  be  fed,  given  shelter,  and 
treated  as  an  honored  guest — but  only  for  a  certain  length  of  time. 
If  a  guest  did  not  go  away,  he  would  eventually  become  a  mere  sub- 
ordinate. The  role  of  such  hangers-on  has  been  largely  neglected  by 
students  of  human  history.  In  many  periods — from  imperial  Rome  to 
medieval  China — probably  the  most  important  relationships,  at  least  in 
towns  and  cities,  were  those  of  patronage.  Anyone  rich  and  important 
would  find  himself  surrounded  by  flunkies,  sycophants,  perpetual  din- 
ner guests,  and  other  sorts  of  willing  dependents.  Drama  and  poetry 
of  the  time  are  full  of  such  characters."  Similarly,  for  much  of  hu- 
man history,  being  respectable  and  middle-class  meant  spending  one's 
mornings  going  from  door  to  door,  paying  one's  respects  to  important 
local  patrons.  To  this  day,  informal  patronage  systems  still  crop  up, 
whenever  relatively  rich  and  powerful  people  feel  the  need  to  assemble 



networks  of  supporters — a  practice  well  documented  in  many  parts 
of  the  Mediterranean,  the  Middle  East,  and  Latin  America.  Such  rela- 
tionships seem  to  consist  of  a  slapdash  mix  of  all  three  principles  that 
I've  been  mapping  out  over  the  course  of  this  chapter;  nevertheless, 
those  observing  them  insist  on  trying  to  cast  them  in  the  language  of 
exchange  and  debt. 

A  final  example:  in  a  collection  called  Gifts  and  Spoils,  published  in 
1971,  we  find  a  brief  essay  by  the  anthropologist  Lorraine  Blaxter  about 
a  rural  department  in  the  French  Pyrenees,  most  of  whose  inhabitants 
are  farmers.  Everyone  places  a  great  emphasis  on  the  importance  of 
mutual  aid — the  local  phrase  means  "giving  service"  {rendre  service). 
People  living  in  the  same  community  should  look  out  for  one  another 
and  pitch  in  when  their  neighbors  are  having  trouble.  This  is  the  es- 
sence of  communal  morality,  in  fact,  it's  how  one  knows  that  any  sort 
of  community  exists.  So  far  so  good.  However,  she  notes,  when  some- 
one does  a  particularly  great  favor,  mutual  aid  can  turn  into  something 

If  a  man  in  a  factory  went  to  the  boss  and  asked  for  a  job,  and 
the  boss  found  him  one,  this  would  be  an  example  of  someone 
giving  service.  The  man  who  got  the  job  could  never  repay  the 
boss,  but  he  could  show  him  respect,  or  perhaps  give  him  sym- 
bolic gifts  of  garden  produce.  If  a  gift  demands  a  return,  and 
no  tangible  return  is  possible,  the  repayment  will  be  through 
support  or  esteem.56 

Thus  does  mutual  aid  slip  into  inequality.  Thus  do  patron-client 
relations  come  into  being.  We  have  already  observed  this.  I  chose  this 
particular  passage  because  the  author's  phrasing  is  so  weird.  It  com- 
pletely contradicts  itself.  The  boss  does  the  man  a  favor.  The  man 
cannot  repay  the  favor.  Therefore,  the  man  repays  the  favor  by  show- 
ing up  at  the  boss's  house  with  the  occasional  basket  of  tomatoes 
and  showing  him  respect.  So  which  one  is  it?  Can  he  repay  the  favor, 
or  not? 

Peter  Freuchen's  walrus  hunter  would,  no  doubt,  think  he  knew 
exactly  what  was  going  on  here.  Bringing  the  basket  of  tomatoes  was 
simply  the  equivalent  of  saying  "Thank  you."  It  was  a  way  of  ac- 
knowledging that  one  owes  a  debt  of  gratitude,  that  gifts  had  in  fact 
made  slaves  just  as  whips  make  dogs.  The  boss  and  the  employee  are 
now  fundamentally  different  sorts  of  people.  The  problem  is  that  in 
all  other  respects,  they  are  not  fundamentally  different  sorts  of  people. 
Most  likely  they  are  both  middle-aged  Frenchmen,  fathers  of  families, 



citizens  of  the  Republic  with  similar  tastes  in  music,  sports,  and  food. 
They  ought  to  be  equals.  As  a  result,  even  the  tomatoes,  which  are  re- 
ally a  token  of  recognition  of  the  existence  of  a  debt  that  can  never  be 
repaid,  has  to  be  represented  as  if  it  was  itself  a  kind  of  repayment — 
an  interest  payment  on  a  loan  that  could,  everyone  agrees  to  pretend, 
someday  be  paid  back,  thus  returning  the  two  members  to  their  proper 
equal  status  once  again.57 

(It's  telling  that  the  favor  is  finding  the  client  a  job  in  a  factory, 
because  what  happens  is  not  very  different  from  what  happens  when 
you  get  a  job  in  a  factory  to  begin  with.  A  wage-labor  contract  is, 
ostensibly,  a  free  contract  between  equals — but  an  agreement  between 
equals  in  which  both  agree  that  once  one  of  them  punches  the  time 
clock,  they  won't  be  equals  any  more.58  The  law  does  recognize  a  bit  of 
a  problem  here;  that's  why  it  insists  that  you  cannot  sell  off  your  equal- 
ity permanently  [you  are  not  free  to  sell  yourself  into  slavery].  Such  ar- 
rangements are  only  acceptable  if  the  boss's  power  is  not  absolute,  if  it 
is  limited  to  work  time,  and  if  you  have  the  legal  right  to  break  off  the 
contract  and  thereby  to  restore  yourself  to  full  equality,  at  any  time.) 

It  seems  to  me  that  this  agreement  between  equals  to  no  longer  be 
equal  (at  least  for  a  time)  is  critically  important.  It  is  the  very  essence 
of  what  we  call  "debt." 

What,  then,  is  debt? 

Debt  is  a  very  specific  thing,  and  it  arises  from  very  specific  situ- 
ations. It  first  requires  a  relationship  between  two  people  who  do  not 
consider  each  other  fundamentally  different  sorts  of  being,  who  are 
at  least  potential  equals,  who  are  equals  in  those  ways  that  are  really 
important,  and  who  are  not  currently  in  a  state  of  equality — but  for 
whom  there  is  some  way  to  set  matters  straight. 

In  the  case  of  gift-giving,  as  we've  seen,  this  requires  a  certain 
equality  of  status.  That's  why  our  economics  professor  didn't  feel  any 
sense  of  obligation — any  debt  of  honor — if  taken  out  to  dinner  by 
someone  who  ranked  either  much  higher  or  much  lower  than  himself. 
With  money  loans,  all  that  is  required  is  that  the  two  parties  be  of 
equal  legal  standing.  (You  can't  lend  money  to  a  child,  or  to  a  lunatic. 
Well,  you  can,  but  the  courts  won't  help  you  get  it  back.)  Legal — rather 
than  moral — debts  have  other  unique  qualities.  For  instance,  they  can 
be  forgiven,  which  isn't  always  possible  with  a  moral  debt. 

This  means  that  there  is  no  such  thing  as  a  genuinely  unpayable 
debt.  If  there  was  no  conceivable  way  to  salvage  the  situation,  we 



wouldn't  be  calling  it  a  "debt."  Even  the  French  villager  could,  con- 
ceivably, save  his  patron's  life,  or  win  the  lottery  and  buy  the  factory. 
Even  when  we  speak  of  a  criminal  "paying  his  debt  to  society,"  we  are 
saying  that  he  has  done  something  so  terrible  that  he  has  now  been 
banished  from  that  equal  status  under  the  law  that  belongs  by  natural 
right  to  any  citizen  of  his  country;  however,  we  call  it  a  "debt"  because 
it  can  be  paid,  equality  can  be  restored,  even  if  the  cost  may  be  death 
by  lethal  injection. 

During  the  time  that  the  debt  remains  unpaid,  the  logic  of  hierar- 
chy takes  hold.  There  is  no  reciprocity.  As  anyone  who  has  ever  been 
in  jail  knows,  the  first  thing  the  jailors  communicate  is  that  nothing 
that  happens  in  jail  has  anything  to  do  with  justice.  Similarly,  debtor 
and  creditor  confront  each  other  like  a  peasant  before  a  feudal  lord. 
The  law  of  precedent  takes  hold.  If  you  bring  your  creditor  tomatoes 
from  the  garden,  it  never  occurs  to  you  that  he  would  give  something 
back.  He  might  expect  you  to  do  it  again,  though.  But  always  there  is 
the  assumption  that  the  situation  is  somewhat  unnatural,  because  the 
debt  really  ought  to  be  paid. 

This  is  what  makes  situations  of  effectively  unpayable  debt  so  dif- 
ficult and  so  painful.  Since  creditor  and  debtor  are  ultimately  equals,  if 
the  debtor  cannot  do  what  it  takes  to  restore  herself  to  equality,  there 
is  obviously  something  wrong  with  her;  it  must  be  her  fault. 

This  connection  becomes  clear  if  we  look  at  the  etymology  of  com- 
mon words  for  "debt"  in  European  languages.  Many  are  synonyms  for 
"fault,"  "sin,"  or  "guilt;"  just  as  a  criminal  owes  a  debt  to  society,  a 
debtor  is  always  a  sort  of  criminal.59  In  ancient  Crete,  according  to  Plu- 
tarch, it  was  the  custom  for  those  taking  loans  to  pretend  to  snatch  the 
money  from  the  lender's  purse.  Why,  he  wondered?  Probably  "so  that, 
if  they  default,  they  could  be  charged  with  violence  and  punished  all 
the  more."60  This  is  why  in  so  many  periods  of  history  insolvent  debt- 
ors could  be  jailed,  or  even — as  in  early  Republican  Rome — executed. 

A  debt,  then,  is  just  an  exchange  that  has  not  been  brought  to 

It  follows  that  debt  is  strictly  a  creature  of  reciprocity  and  has  little 
to  do  with  other  sorts  of  morality  (communism,  with  its  needs  and 
abilities;  hierarchy,  with  its  customs  and  qualities).  True,  if  we  were 
really  determined,  we  could  argue  (as  some  do)  that  communism  is  a 
condition  of  permanent  mutual  indebtedness,  or  that  hierarchy  is  con- 
structed out  of  unpayable  debts.  But  isn't  this  just  the  same  old  story, 
starting  from  the  assumption  that  all  human  interactions  must  be,  by 
definition,  forms  of  exchange,  and  then  performing  whatever  mental 
somersaults  are  required  to  prove  it? 



No.  All  human  interactions  are  not  forms  of  exchange.  Only  some 
are.  Exchange  encourages  a  particular  way  of  conceiving  human  rela- 
tions. This  is  because  exchange  implies  equality,  but  it  also  implies 
separation.  It's  precisely  when  the  money  changes  hands,  when  the 
debt  is  cancelled,  that  equality  is  restored  and  both  parties  can  walk 
away  and  have  nothing  further  to  do  with  each  other. 

Debt  is  what  happens  in  between:  when  the  two  parties  cannot 
yet  walk  away  from  each  other,  because  they  are  not  yet  equal.  But 
it  is  carried  out  in  the  shadow  of  eventual  equality.  Because  achieving 
that  equality,  however,  destroys  the  very  reason  for  having  a  relation- 
ship, just  about  everything  interesting  happens  in  between.61  In  fact, 
just  about  everything  human  happens  in  between — even  if  this  means 
that  all  such  human  relations  bear  with  them  at  least  a  tiny  element  of 
criminality,  guilt,  or  shame. 

For  the  Tiv  women  whom  I  mentioned  earlier  in  the  chapter,  this 
wasn't  much  of  a  problem.  By  ensuring  that  everyone  was  always 
slightly  in  debt  to  one  another,  they  actually  created  human  society,  if 
a  very  fragile  sort  of  society — a  delicate  web  made  up  of  obligations  to 
return  three  eggs  or  a  bag  of  okra,  ties  renewed  and  recreated,  as  any 
one  of  them  could  be  cancelled  out  at  any  time. 

Our  own  habits  of  civility  are  not  so  very  different.  Consider  the 
custom,  in  American  society,  of  constantly  saying  "please"  and  "thank 
you."  To  do  so  is  often  treated  as  basic  morality:  we  are  constantly 
chiding  children  for  forgetting  to  do  it,  just  as  the  moral  guardians 
of  our  society — teachers  and  ministers,  for  instance — do  to  everybody 
else.  We  often  assume  that  the  habit  is  universal,  but  as  the  Inuit  hunter 
made  clear,  it  is  not.62  Like  so  many  of  our  everyday  courtesies,  it  is  a 
kind  of  democratization  of  what  was  once  a  habit  of  feudal  deference: 
the  insistence  on  treating  absolutely  everyone  the  way  that  one  used 
only  to  have  to  treat  a  lord  or  similar  hierarchical  superior. 

Perhaps  this  is  not  so  in  every  case.  Imagine  we  are  on  a  crowded 
bus,  looking  for  a  seat.  A  fellow  passenger  moves  her  bag  aside  to  clear 
one;  we  smile,  or  nod,  or  make  some  other  little  gesture  of  acknowl- 
edgment. Or  perhaps  we  actually  say  "Thank  you."  Such  a  gesture 
is  simply  a  recognition  of  common  humanity:  we  are  acknowledging 
that  the  woman  who  had  been  blocking  the  seat  is  not  a  mere  physical 
obstacle  but  a  human  being,  and  that  we  feel  genuine  gratitude  toward 
someone  we  will  likely  never  see  again.  None  of  this  is  generally  true 
when  one  asks  someone  across  the  table  to  "please  pass  the  salt,"  or 
when  the  postman  thanks  you  for  signing  for  a  delivery.  We  think  of 
these  simultaneously  as  meaningless  formalities  and  as  the  very  moral 
basis  of  society.  Their  apparent  unimportance  can  be  measured  by  the 



fact  that  almost  no  one  would  refuse,  on  principle,  to  say  "please"  or 
"thank  you"  in  just  about  any  situation — even  those  who  might  find  it 
almost  impossible  to  say  "I'm  sorry"  or  "I  apologize." 

In  fact,  the  English  "please"  is  short  for  "if  you  please,"  "if  it 
pleases  you  to  do  this" — it  is  the  same  in  most  European  languages 
(French  si  il  vous  plait,  Spanish  por  favor).  Its  literal  meaning  is  "you 
are  under  no  obligation  to  do  this."  "Hand  me  the  salt.  Not  that  I  am 
saying  that  you  have  to!"  This  is  not  true;  there  is  a  social  obligation, 
and  it  would  be  almost  impossible  not  to  comply.  But  etiquette  largely 
consists  of  the  exchange  of  polite  fictions  (to  use  less  polite  language, 
lies).  When  you  ask  someone  to  pass  the  salt,  you  are  also  giving  them 
an  order;  by  attaching  the  word  "please,"  you  are  saying  that  it  is  not 
an  order.  But,  in  fact,  it  is. 

In  English,  "thank  you"  derives  from  "think,"  it  originally  meant, 
"I  will  remember  what  you  did  for  me" — which  is  usually  not  true 
either — but  in  other  languages  (the  Portuguese  obrigado  is  a  good 
example)  the  standard  term  follows  the  form  of  the  English  "much 
obliged" — it  actually  does  means  "I  am  in  your  debt."  The  French 
merci  is  even  more  graphic:  it  derives  from  "mercy,"  as  in  begging  for 
mercy;  by  saying  it  you  are  symbolically  placing  yourself  in  your  bene- 
factor's power — since  a  debtor  is,  after  all,  a  criminal.63  Saying  "you're 
welcome,"  or  "it's  nothing"  (French  de  rien,  Spanish  de  nada) — the 
latter  has  at  least  the  advantage  of  often  being  literally  true — is  a  way 
of  reassuring  the  one  to  whom  one  has  passed  the  salt  that  you  are  not 
actually  inscribing  a  debit  in  your  imaginary  moral  account  book.  So  is 
saying  "my  pleasure" — you  are  saying,  "No,  actually,  it's  a  credit,  not 
a  debit — you  did  me  a  favor  because  in  asking  me  to  pass  the  salt,  you 
gave  me  the  opportunity  to  do  something  I  found  rewarding  in  itself!"64 

Decoding  the  tacit  calculus  of  debt  ("I  owe  you  one,"  "No,  you 
don't  owe  me  anything,"  "Actually,  if  anything,  it's  me  who  owes  you," 
as  if  inscribing  and  then  scratching  off  so  many  infinitesimal  entries  in 
an  endless  ledger)  makes  it  easy  to  understand  why  this  sort  of  thing 
is  often  viewed  not  as  the  quintessence  of  morality,  but  as  the  quintes- 
sence of  middle-class  morality.  True,  by  now  middle-class  sensibilities 
dominate  society.  But  there  are  still  those  who  find  the  practice  odd. 
Those  at  the  very  top  of  society  often  still  feel  that  deference  is  owed 
primarily  to  hierarchical  superiors  and  find  it  slightly  idiotic  to  watch 
postmen  and  pastry  cooks  taking  turns  pretending  to  treat  each  other 
like  little  feudal  lords.  At  the  other  extreme,  those  who  grew  up  in 
what  in  Europe  are  called  "popular"  environments — small  towns,  poor 
neighborhoods,  anyplace  where  there  is  still  an  assumption  that  people 
who  are  not  enemies  will,  ordinarily,  take  care  of  one  another — will 



often  find  it  insulting  to  be  constantly  told,  in  effect,  that  there  is  some 
chance  they  might  not  do  their  job  as  a  waiter  or  taxi  driver  correctly, 
or  provide  houseguests  with  tea.  In  other  words,  middle-class  etiquette 
insists  that  we  are  all  equals,  but  it  does  so  in  a  very  particular  way.  On 
the  one  hand,  it  pretends  that  nobody  is  giving  anybody  orders  (think 
here  of  the  burly  security  guard  at  the  mall  who  appears  before  someone 
walking  into  a  restricted  area  and  says,  "Can  I  help  you?");  on  the  other, 
it  treats  every  gesture  of  what  I've  been  calling  "baseline  communism"  as 
if  it  were  really  a  form  of  exchange.  As  a  result,  like  Tiv  neighborhoods, 
middle-class  society  has  to  be  endlessly  recreated,  as  a  kind  of  constant 
flickering  game  of  shadows,  the  criss-crossing  of  an  infinity  of  momen- 
tary debt  relations,  each  one  almost  instantly  cancelled  out. 

All  of  this  is  a  relatively  recent  innovation.  The  habit  of  always 
saying  "please"  and  "thank  you"  first  began  to  take  hold  during  the 
commercial  revolution  of  the  sixteenth  and  seventeenth  centuries — 
among  those  very  middle  classes  who  were  largely  responsible  for  it.  It 
is  the  language  of  bureaus,  shops,  and  offices,  and  over  the  course  of 
the  last  five  hundred  years  it  has  spread  across  the  world  along  with 
them.  It  is  also  merely  one  token  of  a  much  larger  philosophy,  a  set 
of  assumptions  of  what  humans  are  and  what  they  owe  one  another, 
that  have  by  now  become  so  deeply  ingrained  that  we  cannot  see  them. 

Sometimes,  at  the  brink  of  a  new  historical  era,  some  prescient  soul  can 
see  the  full  implications  of  what  is  beginning  to  happen — sometimes 
in  a  way  that  later  generations  can't.  Let  me  end  with  a  text  by  such  a 
person.  In  Paris,  sometime  in  1540s,  Francois  Rabelais — lapsed  monk, 
doctor,  legal  scholar — composed  what  was  to  become  a  famous  mock 
eulogy,  which  he  inserted  in  the  third  book  of  his  great  Gargantua  and 
Pantagruel,  and  which  came  to  be  known  as  "In  Praise  of  Debt." 

Rabelais  places  the  encomium  in  the  mouth  of  one  Panurge,  a 
wandering  scholar  and  man  of  extreme  classical  erudition  who,  he  ob- 
serves, "knew  sixty-three  ways  of  making  money — the  most  honorable 
and  most  routine  of  which  was  stealing."65  The  good-natured  giant 
Pantagruel  adopts  Panurge  and  even  provides  him  with  a  respectable 
income,  but  it  bothers  him  that  Panurge  continues  to  spend  money  like 
water  and  remains  up  to  his  ears  in  debt.  Wouldn't  it  be  better,  Pan- 
tagruel suggests,  to  be  able  to  pay  his  creditors? 

Panurge  responds  with  horror:  "God  forbid  that  I  should  ever  be 
out  of  debt!"  Debt  is,  in  fact,  the  very  basis  of  his  philosophy: 



Always  owe  somebody  something,  then  he  will  be  forever  pray- 
ing God  to  grant  you  a  good,  long  and  blessed  life.  Fearing  to 
lose  what  you  owe  him,  he  will  always  be  saying  good  things 
about  you  in  every  sort  of  company;  he  will  be  constantly  ac- 
quiring new  lenders  for  you,  so  that  you  can  borrow  to  pay 
him  back,  filling  his  ditch  with  other  men's  spoil.66 

Above  all  else,  they  will  always  be  praying  that  you  come  into 
money.  It's  like  those  ancient  slaves  destined  to  be  sacrificed  at  their 
masters'  funerals.  When  they  wished  their  master  long  life  and  good 
health,  they  genuinely  meant  it!  What's  more,  debt  can  make  you  into  a 
kind  of  god,  who  can  make  something  (money,  well-wishing  creditors) 
out  of  absolutely  nothing. 

Worse  still:  I  give  myself  to  bonnie  Saint  Bobelin  if  all  my  life 
I  have  not  reckoned  debts  to  be,  as  it  were,  a  connection  and 
colligation  between  Heaven  and  Earth  (uniquely  preserving  the 
lineage  of  Man  without  which,  I  say,  all  human  beings  would 
soon  perish)  and  perhaps  to  be  that  great  World  Soul  which, 
according  to  the  Academics,  gives  life  to  all  things. 

That  it  really  is  so,  evoke  tranquilly  in  your  mind  the  Idea 
and  Form  of  a  world — take  if  you  like  the  thirtieth  of  the 
worlds  imagined  by  Metrodorus — in  which  there  were  no  debt- 
ors or  lenders  at  all.  A  universe  sans  debts!  Amongst  the  heav- 
enly bodies  there  would  be  no  regular  course  whatsoever:  all 
would  be  in  disarray.  Jupiter,  reckoning  that  he  owed  no  debt 
to  Saturn,  would  dispossess  him  of  his  sphere,  and  with  his  Ho- 
meric chain  hold  in  suspension  all  the  Intelligences,  gods,  heav- 
ens, daemons,  geniuses,  heroes,  devils,  earth,  sea  and  all  the 
elements  .  .  .  The  Moon  would  remain  dark  and  bloody;  why 
should  the  Sun  share  his  light  with  her?  He  is  under  no  obliga- 
tion. The  Sun  would  never  shine  on  their  Earth;  the  heavenly 
bodies  would  pour  no  good  influences  down  upon  it. 

Between  the  elements  there  will  be  no  mutual  sharing  of 
qualities,  no  alternation,  no  transmutation  whatsoever,  one 
will  not  think  itself  obliged  to  the  other;  it  has  lent  it  nothing. 
From  earth  no  longer  will  water  be  made,  nor  water  trans- 
muted into  air;  from  air  fire  will  not  be  made,  and  fire  will  not 
warm  the  earth.  Earth  will  bring  forth  nothing  but  monsters, 
Titans,  giants.  The  rain  will  not  rain,  the  light  will  shed  no 
light,  the  wind  will  not  blow,  and  there  will  be  no  summer,  no 
autumn,  Lucifer  will  tear  off  his  bonds  and,  sallying  forth  from 
deepest  Hell  with  the  Furies,  the  Vengeances  and  the  horned 



devils,  will  seek  to  turf  the  gods  of  both  the  greater  and  lesser 
nations  out  from  their  nests  in  the  heavens. 

And  what's  more,  if  human  beings  owed  nothing  to  one  another, 
life  would  "be  no  better  than  a  dog-fight" — a  mere  unruly  brawl. 

Amongst  human  beings  none  will  save  another;  it  will  be  no 
good  a  man  shouting  Help!  Fire!  I'm  drowning!  Murder!  No- 
body will  come  and  help  him.  Why?  Because  he  has  lent  noth- 
ing: and  no  one  owes  him  anything.  No  one  has  anything  to 
lose  by  his  fire,  his  shipwreck,  his  fall,  or  his  death.  He  has  lent 
nothing.  And:  he  would  lend  nothing  either  hereafter. 

In  short,  Faith,  Hope  and  Charity  would  be  banished  from 
this  world. 

Panurge — a  man  without  a  family,  alone,  whose  entire  calling  in 
life  was  getting  large  amounts  of  money  and  then  spending  it — serves 
as  a  fitting  prophet  for  the  world  that  was  just  beginning  to  emerge. 
His  perspective  of  course  is  that  of  a  wealthy  debtor — not  one  liable 
to  be  trundled  off  to  some  pestiferous  dungeon  for  failure  to  pay.  Still, 
what  he  is  describing  is  the  logical  conclusion,  the  reductio  ad  absur- 
dum,  which  Rabelais  as  always  lays  out  with  cheerful  perversity,  of  the 
assumptions  about  the  world  as  exchange  slumbering  behind  all  our 
pleasant  bourgeois  formalities  (which  Rabelais  himself,  incidentally, 
detested — the  book  is  basically  a  mixture  of  classical  erudition  and 
dirty  jokes). 

And  what  he  says  is  true.  If  we  insist  on  defining  all  human  interac- 
tions as  matters  of  people  giving  one  thing  for  another,  then  any  ongo- 
ing human  relations  can  only  take  the  form  of  debts.  Without  them, 
no  one  would  owe  anything  to  anybody.  A  world  without  debt  would 
revert  to  primordial  chaos,  a  war  of  all  against  all;  no  one  would  feel 
the  slightest  responsibility  for  one  another;  the  simple  fact  of  being  hu- 
man would  have  no  significance;  we  would  all  become  isolated  planets 
who  couldn't  even  be  counted  on  to  maintain  our  proper  orbits. 

Pantagruel  will  have  none  of  it.  His  own  feelings  on  the  matter,  he 
says,  can  be  summed  up  with  one  line  from  the  Apostle  Paul:  "Owe 
no  man  anything,  save  mutual  love  and  affection."67  Then,  in  an  ap- 
propriately biblical  gesture,  he  declares,  "From  your  past  debts  I  shall 
free  you." 

"What  can  I  do  but  thank  you?"  Panurge  replies. 

Chapter  Six 


WHEN  WE  RETURN  to  an  examination  of  conventional  economic 
history,  one  thing  that  jumps  out  is  how  much  has  been  made  to  dis- 
appear. Reducing  all  human  life  to  exchange  means  not  only  shunting 
aside  all  other  forms  of  economic  experience  (hierarchy,  communism), 
but  also  ensuring  that  the  vast  majority  of  the  human  race  who  are 
not  adult  males,  and  therefore  whose  day-to-day  existence  is  relatively 
difficult  to  reduce  to  a  matter  of  swapping  things  in  such  a  way  as  to 
seek  mutual  advantage,  melt  away  into  the  background. 

As  a  result,  we  end  up  with  a  sanitized  view  of  the  way  actual 
business  is  conducted.  The  tidy  world  of  shops  and  malls  is  the  quintes- 
sential middle-class  environment,  but  at  either  the  top  or  the  bottom  of 
the  system,  the  world  of  financiers  or  of  gangsters,  deals  are  often  made 
in  ways  not  so  completely  different  from  ways  that  the  Gunwinggu  or 
Nambikwara  make  them — at  least  in  that  sex,  drugs,  music,  extrava- 
gant displays  of  food,  and  the  potential  for  violence  do  often  play  parts. 

Consider  the  case  of  Neil  Bush  (George  W.'s  brother)  who,  during 
divorce  proceedings  with  his  wife,  admitted  to  multiple  infidelities  with 
women  who,  he  claimed,  would  mysteriously  appear  at  his  hotel-room 
door  after  important  business  meetings  in  Thailand  and  Hong  Kong. 

"You  have  to  admit  it's  pretty  remarkable,"  remarked  one  of 
his  wife's  attorneys,  "for  a  man  to  go  to  a  hotel-room  door 
and  open  it  and  have  a  woman  standing  there  and  have  sex 
with  her." 

"It  was  very  unusual,"  Bush  replied,  admitting  however  that 
this  had  happened  to  him  on  numerous  occasions. 
"Were  they  prostitutes?" 
"I  don't  know.'" 

In  fact,  such  things  seem  almost  par  for  the  course  when  really  big 
money  comes  into  play. 



In  this  light,  the  economists'  insistence  that  economic  life  begins 
with  barter,  the  innocent  exchange  of  arrows  for  teepee  frames,  with 
no  one  in  a  position  to  rape,  humiliate,  or  torture  anyone  else,  and  that 
it  continues  in  this  way,  is  touchingly  Utopian. 

As  a  result,  though,  the  histories  we  tell  are  full  of  blank  spaces, 
and  the  women  in  them  seem  to  appear  out  of  nowhere,  without  ex- 
planation, much  like  the  Thai  women  who  appeared  at  Bush's  door. 
Recall  the  passage  cited  in  Chapter  Three,  from  numismatist  Philip 
Grierson,  about  money  in  the  barbarian  law  codes: 

Compensation  in  the  Welsh  laws  is  reckoned  primarily  in  cattle 
and  in  the  Irish  ones  in  cattle  or  bondmaids  (cumal),  with  con- 
siderable use  of  precious  metals  in  both.  In  the  Germanic  codes 
it  is  mainly  in  precious  metal  .  .  } 

How  is  it  possible  to  read  this  passage  without  immediately  stop- 
ping at  the  end  of  the  first  line?  "Bondmaids"?  Doesn't  that  mean 
"slaves?"  (It  does.)  In  ancient  Ireland,  female  slaves  were  so  plentiful 
and  important  that  they  came  to  function  as  currency.  How  did  that 
happen?  And  if  we  are  trying  to  understand  the  origins  of  money, 
here,  isn't  the  fact  that  people  are  using  one  another  as  currency  at  all 
interesting  or  significant?3  Yet  none  of  the  sources  on  money  remark 
much  on  it.  It  would  seem  that  by  the  time  of  the  law  codes,  slave  girls 
were  not  actually  traded,  but  just  used  as  units  of  account.  Still,  they 
must  have  been  traded  at  some  point.  Who  were  they?  How  were  they 
enslaved?  Were  they  captured  in  war,  sold  by  their  parents,  or  reduced 
to  slavery  through  debt?  Were  they  a  major  trade  item?  The  answer 
to  all  these  questions  would  seem  to  be  yes,  but  it's  hard  to  say  more 
because  the  history  remains  largely  unwritten.4 

Or  let's  return  to  the  parable  of  the  ungrateful  servant.  "Since  he 
was  not  able  to  pay,  the  master  ordered  that  he  and  his  wife  and  his 
children  and  all  that  he  had  be  sold  to  repay  the  debt."  How  did  that 
happen?  Note  that  we're  not  even  speaking  of  debt  service  here  (he  is 
already  his  creditor's  servant),  but  outright  slavery.  How  did  a  man's 
wife  and  children  come  to  be  considered  no  different  than  his  sheep 
and  crockery — as  property  to  be  liquidated  on  the  occasion  of  default? 
Was  it  normal  for  a  man  in  first-century  Palestine  to  be  able  to  sell  his 
wife?  (It  wasn't.)5  If  he  didn't  own  her,  why  was  someone  else  allowed 
to  sell  her  if  he  couldn't  pay  his  debts? 

The  same  could  be  asked  of  the  story  in  Nehemiah.  It's  hard  not 
to  empathize  with  the  distress  of  a  father  watching  his  daughter  taken 



off  by  strangers.  On  the  other  hand,  one  might  also  ask:  Why  weren't 
they  taking  him?  The  daughter  hadn't  borrowed  any  money. 

It's  not  as  if  it  is  ordinary  for  fathers  in  traditional  societies  to  be 
able  to  sell  their  children.  This  is  a  practice  with  a  very  specific  his- 
tory: it  appears  in  the  great  agrarian  civilizations,  from  Sumer  to  Rome 
to  China,  right  around  the  time  when  we  also  start  to  see  evidence 
of  money,  markets,  and  interest-bearing  loans;  later,  more  gradually, 
it  also  appears  in  those  surrounding  hinterlands  that  supplied  those 
civilizations  with  slaves.6  What's  more,  if  we  examine  the  historical 
evidence,  there  seems  good  reason  to  believe  that  the  very  obsession 
with  patriarchal  honor  that  so  defines  "tradition"  in  the  Middle  East 
and  Mediterranean  world  itself  arose  alongside  the  father's  power  to 
alienate  his  children — as  a  reaction  to  what  were  seen  as  the  moral  per- 
ils of  the  market.  All  of  this  is  treated  as  somehow  outside  the  bounds 
of  economic  history. 

Excluding  all  this  is  deceptive  not  only  because  it  excludes  the  main 
purposes  to  which  money  was  actually  put  in  the  past,  but  because  it 
doesn't  give  us  a  clear  vision  of  the  present.  After  all,  who  were  those 
Thai  women  who  so  mysteriously  appeared  at  Neil  Bush's  hotel  door? 
Almost  certainly,  they  were  children  of  indebted  parents.  Likely  as  not, 
they  were  contractual  debt  peons  themselves.7 

Focusing  on  the  sex  industry  would  be  deceptive,  though.  Then  as 
now,  most  women  in  debt  bondage  spend  the  vast  majority  of  their 
time  sewing,  preparing  soups,  and  scouring  latrines.  Even  in  the  Bible, 
the  admonition  in  the  Ten  Commandments  not  to  "covet  thy  neighbor's 
wife"  clearly  referred  not  to  lust  in  one's  heart  (adultery  had  already 
been  covered  in  commandment  number  seven),  but  to  the  prospect 
of  taking  her  as  a  debt-peon — in  other  words,  as  a  servant  to  sweep 
one's  yard  and  hang  out  the  laundry.8  In  most  such  matters,  sexual 
exploitation  was  at  best  incidental  (usually  illegal,  sometimes  practiced 
anyway,  symbolically  important.)  Again,  once  we  remove  some  of  our 
usual  blinders,  we  can  see  that  matters  have  changed  far  less,  over  the 
course  of  the  last  five  thousand  years  or  so,  than  we  really  like  to  think. 

These  blinders  are  all  the  more  ironic  when  one  looks  at  the  anthro- 
pological literature  on  what  used  to  be  called  "primitive  money" — 
that  is,  the  sort  one  encounters  in  places  where  there  are  no  states  or 
markets — whether  Iroquois  wampum,  African  cloth  money,  or  Solo- 
mon Island  feather  money,  and  discovers  that  such  money  is  used 



almost  exclusively  for  the  kinds  of  transactions  that  economists  don't 
like  to  have  to  talk  about. 

In  fact,  the  term  "primitive  money"  is  deceptive  for  this  very  rea- 
son, since  it  suggests  that  we  are  dealing  with  a  crude  version  of  the 
kind  of  currencies  we  use  today.  But  this  is  precisely  what  we  don't 
find.  Often,  such  currencies  are  never  used  to  buy  and  sell  anything 
at  all.9  Instead,  they  are  used  to  create,  maintain,  and  otherwise  reor- 
ganize relations  between  people:  to  arrange  marriages,  establish  the 
paternity  of  children,  head  off  feuds,  console  mourners  at  funerals,  seek 
forgiveness  in  the  case  of  crimes,  negotiate  treaties,  acquire  followers — 
almost  anything  but  trade  in  yams,  shovels,  pigs,  or  jewelry. 

Often,  these  currencies  were  extremely  important,  so  much  so  that 
social  life  itself  might  be  said  to  revolve  around  getting  and  disposing 
of  the  stuff.  Clearly,  though,  they  mark  a  totally  different  conception 
of  what  money,  or  indeed  an  economy,  is  actually  about.  I've  decided 
therefore  to  refer  to  them  as  "social  currencies,"  and  the  economies 
that  employ  them  as  "human  economies."  By  this  I  mean  not  that  these 
societies  are  necessarily  in  any  way  more  humane  (some  are  quite  hu- 
mane; others  extraordinarily  brutal),  but  only  that  they  are  economic 
systems  primarily  concerned  not  with  the  accumulation  of  wealth,  but 
with  the  creation,  destruction,  and  rearranging  of  human  beings. 

Historically,  commercial  economies — market  economies,  as  we 
now  like  to  call  them — are  a  relative  newcomer.  For  most  of  human 
history,  human  economies  predominated.  To  even  begin  to  write  a 
genuine  history  of  debt,  then,  we  have  to  start  by  asking:  What  sort  of 
debts,  what  sort  of  credits  and  debits,  do  people  accumulate  in  human 
economies?  And  what  happens  when  human  economies  begin  to  give 
away  to  or  are  taken  over  by  commercial  ones?  This  is  another  way  of 
asking  the  question,  "How  do  mere  obligations  turn  into  debts?" — but 
it  means  not  just  asking  the  question  in  the  abstract,  but  examining  the 
historical  record  to  try  to  reconstruct  what  actually  did  happen. 

This  is  what  I  will  do  over  the  course  of  the  next  two  chapters. 
First  I  will  look  at  the  role  of  money  in  human  economies,  then  de- 
scribe what  can  happen  when  human  economies  are  suddenly  incorpo- 
rated into  the  economic  orbits  of  larger,  commercial  ones.  The  African 
slave  trade  will  serve  as  a  particularly  catastrophic  case  in  point.  Then, 
in  the  next  chapter,  I  will  return  to  the  first  emergence  of  commercial 
economies  in  early  civilizations  of  Europe  and  the  Middle  East. 



Money  as  Inadequate  Substitute 

The  most  interesting  theory  of  the  origin  of  money  is  the  one  recent- 
ly put  forward  by  a  French  economist-turned-anthropologist  named 
Philippe  Rospabe.  While  his  work  is  largely  unknown  in  the  English- 
speaking  world,  it's  quite  ingenious,  and  it  bears  directly  on  our  prob- 
lem. Rospabe's  argument  is  that  "primitive  money"  was  not  originally 
a  way  to  pay  debts  of  any  sort.  It's  a  way  of  recognizing  the  existence 
of  debts  that  cannot  possibly  be  paid.  His  argument  is  worth  consider- 
ing in  detail. 

In  most  human  economies,  money  is  used  first  and  foremost  to 
arrange  marriages.  The  simplest  and  probably  most  common  way  of 
doing  this  was  by  being  presented  as  what  used  to  be  called  "bride- 
price":  a  suitor's  family  would  deliver  a  certain  number  of  dog  teeth, 
or  cowries,  or  brass  rings,  or  whatever  is  the  local  social  currency,  to 
a  woman's  family,  and  they  would  present  their  daughter  as  his  bride. 
It's  easy  to  see  why  this  might  be  interpreted  as  buying  a  women,  and 
many  colonial  officials  in  Africa  and  Oceania  in  the  early  part  of  the 
twentieth  century  did  indeed  come  to  that  conclusion.  The  practice 
caused  something  of  a  scandal,  and  by  1926,  the  League  of  Nations  was 
debating  banning  the  practice  as  a  form  of  slavery.  Anthropologists 
objected.  Really,  they  explained,  this  was  nothing  like  the  purchase  of, 
say,  an  ox — let  alone  a  pair  of  sandals.  After  all,  if  you  buy  an  ox,  you 
don't  have  any  responsibilities  to  the  ox.  What  you  are  really  buying 
is  the  right  to  dispose  of  the  ox  in  any  way  that  pleases  you.  Marriage 
is  entirely  different,  since  a  husband  will  normally  have  just  as  many 
responsibilities  toward  his  wife  as  his  wife  will  have  toward  him.  It's  a 
way  of  rearranging  relations  between  people.  Second  of  all,  if  you  were 
really  buying  a  wife,  you'd  be  able  to  sell  her.  Finally,  the  real  signifi- 
cance of  the  payment  concerns  the  status  of  the  woman's  children:  if 
he's  buying  anything,  it's  the  right  to  call  her  offspring  his  own.10 

The  anthropologists  ended  up  winning  the  argument,  and  "bride- 
price"  was  dutifully  redubbed  "bridewealth."  But  they  never  really  an- 
swered the  question:  What  is  actually  happening  here?  When  a  Fijian 
suitor's  family  presents  a  whale  tooth  to  ask  for  a  woman's  hand  in 
marriage,  is  this  an  advance  payment  for  the  services  the  woman  will 
provide  in  cultivating  her  future  husband's  gardens?  Or  is  he  purchas- 
ing the  future  fertility  of  her  womb?  Or  is  this  a  pure  formality,  the 
equivalent  of  the  dollar  that  has  to  change  hands  in  order  to  seal  a  . con- 
tract? According  to  Rospabe,  it's  none  of  these.  The  whale  tooth,  how- 
ever valuable,  is  not  a  form  of  payment.  It  is  really  an  acknowledgment 



that  one  is  asking  for  something  so  uniquely  valuable  that'payment  of 
any  sort  would  be  impossible.  The  only  appropriate  payment  for  the 
gift  of  a  woman  is  the  gift  of  another  woman;  in  the  meantime,  all  one 
can  do  is  to  acknowledge  the  outstanding  debt. 

There  are  places  where  suitors  say  this  quite  explicitly.  Consider  the 
Tiv  of  Central  Nigeria,  who  we  have  already  met  briefly  in  the  last 
chapter.  Most  of  our  information  on  the  Tiv  comes  from  mid-century, 
when  they  were  still  under  British  colonial  rule.11  Everyone  at  that  time 
insisted  that  a  proper  marriage  should  take  the  form  of  an  exchange 
of  sisters.  One  man  gives  his  sister  in  marriage  to  another,  that  man 
marries  the  sister  of  his  newfound  brother-in-law.  This  is  the  perfect 
marriage  because  the  only  thing  one  can  really  give  in  exchange  for  a 
woman  is  another  woman,. 

Obviously,  even  if  every  family  had  exactly  equal  numbers  of 
brothers  and  sisters,  things  couldn't  always  work  this  neatly.  Say  I 
marry  your  sister  but  you  don't  want  to  marry  mine  (because,  say, 
you  don't  like  her,  or  because  she's  only  five  years  old).  In  that  case, 
you  become  her  "guardian,"  which  means  you  can  claim  the  right  to 
dispose  of  her  in  marriage  to  someone  else — for  instance,  someone 
whose  sister  you  actually  do  wish  to  marry.  This  system  quickly  grew 
into  a  complex  system  in  which  most  important  men  became  guard- 
ians of  numerous  "wards,"  often  scattered  over  wide  areas;  they  would 
swap  and  trade  them  and  in  the  process  accumulate  numerous  wives 
for  themselves,  while  less-fortunate  men  were  only  able  to  marry  late 
in  life,  or  not  at  all.12 

There  was  one  other  expedient.  The  Tiv  at  that  time  used  bundles 
of  brass  rods  as  their  most  prestigious  form  of  currency.  Brass  rods 
were  only  held  by  men,  and  never  used  to  buy  things  in  markets  (mar- 
kets were  dominated  by  women);  instead,  they  were  exchanged  only 
for  things  that  men  considered  of  higher  importance:  cattle,  horses, 
ivory,  ritual  titles,  medical  treatment,  magical  charms.  It  was  possible, 
as  one  Tiv  ethnographer,  Akiga  Sai,  explains,  to  acquire  a  wife  with 
brass  rods,  but  it  required  quite  a  lot  of  them.  You  would  need  to  give 
two  or  three  bundles  of  them  to  her  parents  to  establish  yourself  as  a 
suitor;  then,  when  you  did  finally  make  off  with  her  (such  marriages 
were  always  first  framed  as  elopements),  another  few  bundles  to  as- 
suage her  mother  when  she  showed  up  angrily  demanding  to  know 
what  was  going  on.  This  would  normally  be  followed  by  five  more 
to  get  her  guardian  to  at  least  temporarily  accept  the  situation,  and 



more  still  to  her  parents  when  she  gave  birth,  if  you  were  to  have  any 
chance  of  their  accepting  your  claims  to  be  the  father  of  her  children. 
That  might  get  her  parents  off  your  back,  but  you'd  have  to  pay  off  the 
guardian  forever,  because  you  could  never  really  use  money  to  acquire 
the  rights  to  a  woman.  Everyone  knew  that  the  only  thing  you  can 
legitimately  give  in  exchange  for  a  woman  is  another  woman.  In  this 
case,  everyone  has  to  abide  by  the  pretext  that  a  woman  will  someday 
be  forthcoming.  In  the  meantime,  as  one  ethnographer  succinctly  puts 
it,  "the  debt  can  never  be  fully  paid."13 

According  to  Rospabe,  the  Tiv  are  just  making  explicit  the  un- 
derlying logic  of  bridewealth  everywhere.  The  suitor  presenting  bride- 
wealth  is  never  paying  for  a  woman,  or  even  for  the  rights  to  claim  her 
children.  That  would  imply  that  brass  rods,  or  whale's  teeth,  cowrie 
shells,  or  even  cattle  are  somehow  the  equivalent  of  a  human  being, 
which  by  the  logic  of  a  human  economy  is  obviously  absurd.  Only  a 
human  could  ever  be  considered  equivalent  to  another  human.  All  the 
more  so  since,  in  the  case  of  marriage,  we  are  speaking  of  something 
even  more  valuable  than  one  human  life:  we  are  speaking  of  a  human 
life  that  also  has  the  capacity  to  generate  new  lives. 

Certainly,  many  of  those  who  pay  bridewealth  are,  like  the  Tiv, 
quite  explicit  about  all  this.  Bridewealth  money  is  presented  not  to 
settle  a  debt,  but  as  a  kind  of  acknowledgment  that  there  exists  a 
debt  that  cannot  be  settled  by  means  of  money.  Often  the  two  sides 
will  maintain  at  least  the  polite  fiction  that  there  will,  someday,  be  a 
recompense  in  kind:  that  the  suitor's  clan  will  eventually  provide  one 
of  its  own  women,  perhaps  even  that  very  woman's  daughter  or  grand- 
daughter, to  marry  a  man  of  the  wife's  natal  clan.  Or  maybe  there  will 
be  some  arrangement  about  the  disposition  of  her  children;  perhaps  her 
clan  will  get  to  keep  one  for  itself.  The  possibilities  are  endless. 

Money,  then,  begins,  as  Rospabe  himself  puts  it,  "as  a  substitute  for 
life."14  One  might  call  it  the  recognition  of  a  life-debt.  This,  in  turn,  ex- 
plains why  it's  invariably  the  exact  same  kind  of  money  that's  used  to 
arrange  marriages  that  is  also  used  to  pay  wergeld  (or  "bloodwealth" 
as  it's  sometimes  also  called):  money  presented  to  the  family  of  a  mur- 
der victim  so  as  to  prevent  or  resolve  a  blood-feud.  Here  the  sources 
are  even  more  explicit.  On  the  one  hand,  one  presents  whale  teeth  or 
brass  rods  because  the  murderer's  kin  recognize  they  owe  a  life  to  the 
victim's  family.  On  the  other,  whale  teeth  or  brass  rods  are  in  no  sense, 
and  can  never  be,  compensation  for  the  loss  of  a  murdered  relative. 



Certainly  no  one  presenting  such  compensation  would  ever  be  foolish 
enough  to  suggest  that  any  amount  of  money  could  possibly  be  the 
"equivalent"  to  the  value  of  someone's  father,  sister,  or  child. 

So  here  again,  money  is  first  and  foremost  an  acknowledgment  that 
one  owes  something  much  more  valuable  than  money. 

In  the  case  of  a  blood-feud,  both  parties  will  also  be  aware  that 
even  a  revenge  killing,  while  at  least  it  conforms  to  the  principle  of  a 
life  for  a  life,  won't  really  compensate  for  the  victim's  grief  and  pain 
either.  This  knowledge  allows  for  some  possibility  of  settling  the  mat- 
ter without  violence.  But  even  here,  there  is  often  a  feeling  that,  as  in 
the  case  of  marriage,  the  real  solution  to  the  problem  is  simply  being 
temporarily  postponed. 

An  illustration  might  be  helpful.  Among  the  Nuer,  there  is  a  special 
class  of  priestly  figures  who  specialize  in  mediating  feuds,  referred  to  in 
the  literature  as  "leopard-skin  chiefs."  If  one  man  murders  another,  he 
will  immediately  seek  out  one  of  their  homesteads,  since  such  a  home- 
stead is  treated  as  an  inviolate  sanctuary:  even  the  dead  man's  family, 
who  will  be  honor-bound  to  avenge  the  murder,  will  know  that  they 
cannot  enter  it,  lest  terrible  consequences  ensue.  According  to  Evans- 
Pritchard's  classic  account,  the  chief  will  immediately  start  trying  to 
negotiate  a  settlement  between  the  murderer  and  victim's  families,  a 
delicate  business,  because  the  victim's  family  will  always  first  refuse: 

The  chief  first  finds  out  what  cattle  the  slayer's  people  possess 
and  what  they  are  prepared  to  pay  in  compensation.  ...  He 
then  visits  the  dead  man's  people  and  asks  them  to  accept  cattle 
for  the  life.  They  usually  refuse,  for  it  is  a  point  of  honor  to  be 
obstinate,  but  their  refusal  does  not  mean  that  they  are  unwill- 
ing to  accept  compensation.  The  chief  knows  this  and  insists 
on  their  acceptance,  even  threatening  to  curse  them  if  they  do 
not  give  way  .  .  .'5 

More-distant  kin  weigh  in,  reminding  everyone  of  their  responsi- 
bility to  the  larger  community,  of  all  the  trouble  that  an  outstanding 
feud  will  cause  to  innocent  relatives,  and  after  a  great  show  of  holding 
out,  insisting  that  it  is  insulting  to  suggest  that  any  number  of  cattle 
could  possibly  substitute  for  the  life  of  a  son  or  brother,  they  will  usu- 
ally grudgingly  accept.16  In  fact,  even  once  the  matter  has  technically 
been  settled,  it  really  hasn't — it  usually  takes  years  to  assemble  the 
cattle,  and  even  once  they  have  been  paid,  the  two  sides  will  avoid 
each  other,  "especially  at  dances,  for  in  the  excitement  they  engender, 
merely  bumping  into  a  man  whose  kinsman  has  been  slain  may  cause 



a  fight  to  break  out,  because  the'offense  is  never  forgiven  and  the  score 
must  finally  be  paid  with  a  life."17 

So  it's  much  the  same  as  with  bridewealth.  Money  does  not  wipe 
out  the  debt.  One  life  can  only  be  paid  for  with  another.  At  best  those 
paying  bloodwealth,  by  admitting  the  existence  of  the  debt  and  insist- 
ing that  they  wish  they  could  pay  it,  even  though  they  know  this  is 
impossible,  can  allow  the  matter  to  be  placed  permanently  on  hold. 

Halfway  around  the  world,  one  finds  Lewis  Henry  Morgan  de- 
scribing the  elaborate  mechanisms  set  up  by  the  Six  Nations  of  the 
Iroquois  to  avoid  precisely  this  state  of  affairs.  In  the  event  one  man 
killed  another, 

Immediately  on  the  commission  of  a  murder,  the  affair  was 
taken  up  by  the  tribes  to  which  the  parties  belonged,  and  stren- 
uous efforts  were  made  to  effect  a  reconciliation,  lest  private 
retaliation  should  lead  to  disastrous  consequences. 

The  first  council  ascertained  whether  the  offender  was  will- 
ing to  confess  his  crime,  and  to  make  atonement.  If  he  was, 
the  council  immediately  sent  a  belt  of  white  wampum,  in  his 
name,  to  the  other  council,  which  contained  a  message  to  that 
effect.  The  latter  then  endeavored  to  pacify  the  family  of  the 
deceased,  to  quiet  their  excitement,  and  to  induce  them  to  ac- 
cept the  wampum  as  condonation.18 

Much  as  in  the  case  of  the  Nuer,  there  were  complicated  schedules 
of  exactly  how  many  fathoms  of  wampum  were  paid  over,  depending 
on  the  status  of  the  victim  and  the  nature  of  the  crime.  As  with  the 
Nuer,  too,  everyone  insisted  that  this  was  not  payment.  The  value  of 
the  wampum  in  no  sense  represented  the  value  of  the  dead  man's  life: 

The  present  of  white  wampum  was  not  in  the  nature  of  a 
compensation  for  the  life  of  the  deceased,  but  of  a  regretful 
confession  of  the  crime,  with  a  petition  for  forgiveness.  It  was  a 
peace-offering,  the  acceptance  of  which  was  pressed  by  mutual 
friends  ..." 

Actually,  in  many  cases  there  was  also  some  way  to  manipulate 
the  system  to  turn  payments  meant  to  assuage  one's  rage  and  grief  into 
ways  of  creating  a  new  life  that  would  in  some  sense  substitute  for  the 
one  that  was  lost.  Among  the  Nuer,  forty  cattle  were  set  as  the  stan- 
dard fee  for  bloodwealth.  But  it  was  also  the  standard  rate  of  bride- 
wealth.  The  logic  was  this:  if  a  man  had  been  murdered  before  he  was 



able  to  marry  and  produce  offspring,  it's  only  natural  that  his  spirit 
would  be  angry.  He  had  been,  effectively,  robbed  of  his  eternity.  The 
best  solution  would  be  to  use  the  cattle  paid  in  settlement  to  acquire 
what  was  called  a  "ghost-wife":  a  woman  who  would  then  be  formally 
married  to  the  dead  man.  In  practice,  she  was  usually  paired  off  with 
one  of  the  victim's  brothers,  but  this  was  not  particularly  important; 
it  didn't  really  matter  too  much  who  impregnated  her,  since  he  would 
be  in  no  sense  the  father  of  her  children.  Her  children  would  be  con- 
sidered the  children  of  the  victim's  ghost — and  as  a  result,  any  boys 
among  them  were  seen  as  having  been  born  with  a  particular  commit- 
ment to  someday  avenge  his  death.20 

This  latter  is  unusual.  But  Nuer  appear  to  have  been  unusually 
stubborn  about  feuds.  Rospabe  provides  examples  from  other  parts  of 
the  world  that  are  even  more  telling.  Among  North  African  Bedouins, 
for  instance,  it  sometimes  happened  that  the  only  way  to  settle  a  feud 
was  for  the  killer's  family  to  turn  over  a  daughter,  who  would  then 
marry  the  victim's  next  of  kin — his  brother,  say.  If  she  bore  him  a  male 
child,  the  boy  was  given  the  same  name  as  his  dead  uncle  and  consid- 
ered to  be,  at  least  in  the  broadest  sense,  a  substitute  for  him.21  The 
Iroquois,  who  traced  descent  in  the  female  line,  did  not  trade  women 
in  this  fashion.  However,  they  had  another,  more  direct  approach.  If  a 
man  died — even  of  natural  causes — his  wife's  relatives  might  "put  his 
name  upon  the  mat,"  sending  off  belts  of  wampum  to  commission  a 
war  party,  which  would  then  raid  an  enemy  village  to  secure  a  captive. 
The  captive  could  either  be  killed,  or,  if  the  clan  matrons  were  in  a 
benevolent  mood  (one  could  never  tell;  the  grief  of  mourning  is  tricky), 
adopted:  this  was  signified  by  throwing  a  belt  of  wampum  around  his 
shoulders,  whereon  he  would  be  given  the  name  of  the  deceased  and 
be  considered,  from  that  moment  on,  married  to  the  victim's  wife,  the 
owner  of  his  personal  possessions,  and  in  every  way,  effectively,  the 
exact  same  person  as  the  dead  man  used  to  be.22 

All  of  this  merely  serves  to  underline  Rospabe's  basic  point,  which 
is  that  money  can  be  seen,  in  human  economies,  as  first  and  foremost 
the  acknowledgment  of  the  existence  of  a  debt  that  cannot  be  paid. 

In  a  way,  it's  all  very  reminiscent  of  primordial-debt  theory:  money 
emerges  from  the  recognition  of  an  absolute  debt  to  that  which  has 
given  you  life.  The  difference  is  that  instead  of  imagining  such  debts 
as  between  an  individual  and  society,  or  perhaps  the  cosmos,  here  they 
are  imagined  as  a  kind  of  network  of  dyadic  relations:  almost  everyone 
in  such  societies  was  in  a  relation  of  absolute  debt  to  someone  else.  It's 
not  that  we  owe  "society."  If  there  is  any  notion  of  "society"  here — and 
it's  not  clear  that  there  is — society  is  our  debts. 



Blood  Debts  (Lele) 

Obviously,  this  leads  us  to  the  same  familiar  problem:  How  does  a 
token  of  recognition  that  one  cannot  pay  a  debt  turn  into  a  form  of 
payment  by  which  a  debt  can  be  extinguished?  If  anything,  the  problem 
seems  even  worse  than  it  was  before. 

In  fact,  it  isn't.  The  African  evidence  clearly  shows  how  such  things 
can  happen — though  the  answer  is  a  bit  unsettling.  To  demonstrate 
this,  it  will  be  necessary  to  look  at  one  or  two  African  societies  with  a 
closer  focus. 

I'll  start  with  the  Lele,  an  African  people  who  had,  at  the  time  that 
Mary  Douglas  studied  them  in  the  1950s,  managed  to  turn  the  principle 
of  blood  debts  into  the  organizing  principle  of  their  entire  society. 

The  Lele  were,  at  that  time,  a  group  of  perhaps  ten  thousand 
souls,  living  on  a  stretch  of  rolling  country  near  the  Kasai  River  in  the 
Belgian  Congo,  and  considered  a  rude  backcountry  folk  by  their  richer 
and  more  cosmopolitan  neighbors,  the  Kuba  and  Bushong.  Lele  women 
grew  maize  and  manioc;  the  men  thought  of  themselves  as  intrepid 
hunters  but  spent  most  of  their  time  weaving  and  sewing  raffia-palm 
cloth.  This  cloth  was  what  the  area  was  really  known  for.  It  was  not 
only  used  for  every  sort  of  clothing,  but  also  exported:  the  Lele  consid- 
ered themselves  the  clothiers  of  the  region,  and  it  was  traded  with  sur- 
rounding people  to  acquire  luxuries.  Internally,  it  functioned  as  a  sort 
of  currency.  Still,  it  was  not  used  in  markets  (there  were  no  markets), 
and,  as  Mary  Douglas  discovered  to  her  great  inconvenience,  within  a 
village,  one  couldn't  use  it  to  acquire  food,  tools,  tableware,  or  really 
much  of  anything.11  It  was  the  quintessential  social  currency. 

Informal  gifts  of  raffia  cloth  smooth  all  social  relations:  hus- 
band to  wife,  son  to  mother,  son  to  father.  They  resolve  oc- 
casions of  tension,  as  peace-offerings;  they  make  parting  gifts, 
or  convey  congratulations.  There  are  also  formal  gifts  of  raffia 
which  are  neglected  only  at  risk  of  rupture  of  the  social  ties  in- 
volved. A  man,  on  reaching  adulthood,  should  give  20  cloths  to 
his  father.  Otherwise  he  would  be  ashamed  to  ask  his  father's 
help  for  raising  his  marriage  dues.  A  man  should  give  20  cloths 
to  his  wife  on  each  delivery  of  a  child  .  .  .24 

Cloth  was  also  used  for  various  fines  and  fees,  and  to  pay  curers. 
So  for  instance,  if  a  man's  wife  reported  a  would-be  seducer,  it  was 
customary  to  reward  her  with  20  cloths  for  her  fidelity  (it  was  not 



required,  but  not  doing  so  was  considered  decidedly  unwise);  if  an 
adulterer  was  caught,  he  was  expected  to  pay  50  or  100  cloths  to  the 
woman's  husband;  if  the  husband  and  lover  disturbed  the  peace  of  the 
village  by  fighting  before  the  matter  was  settled,  each  would  have  to 
pay  two  in  compensation,  and  so  forth. 

Gifts  tended  to  flow  upward.  Young  people  were  always  giving 
little  presents  of  cloth  as  marks  of  respect  to  fathers,  mothers,  uncles, 
and  the  like.  These  gifts  were  hierarchical  in  nature:  that  is,  it  never 
occurred  to  those  receiving  them  that  they  should  have  to  reciprocate 
in  any  way.  As  a  result,  elders,  and  especially  elder  men,  usually  had  a 
few  extra  pieces  lying  around,  and  young  men,  who  could  never  weave 
quite  enough  to  meet  their  needs,  would  have  to  turn  to  them  whenever 
time  for  some  major  payment  rolled  around:  for  instance,  if  they  had  to 
pay  a  major  fine,  or  wished  to  hire  a  doctor  to  assist  their  wife  in  child- 
birth, or  wanted  to  join  a  cult  society.  They  were  thus  always  slightly 
in  debt,  or  at  least  slightly  beholden,  to  their  elders.  But  everyone  also 
had  a  whole  range  of  friends  and  relatives  who  they  had  helped  out, 
and  so  could  turn  to  for  assistance.25 

Marriage  was  particularly  expensive,  since  the  arrangements  usually 
required  getting  one's  hands  on  several  bars  of  camwood.  If  raffia  cloth 
was  the  small  change  of  social  life,  camwood — a  rare  imported  wood 
used  for  the  manufacture  of  cosmetics — was  the  high-denomination 
currency.  A  hundred  raffia  cloths  were  equivalent  to  three  to  five  bars. 
Few  individuals  owned  much  in  the  way  of  camwood,  usually  just  little 
bits  to  grind  up  for  their  own  use.  Most  was  kept  in  each  village's  col- 
lective treasury. 

This  is  not  to  say  that  camwood  was  used  for  anything  like 
bridewealth — rather,  it  was  used  in  marriage  negotiations,  in  which 
all  sorts  of  gifts  were  passed  back  and  forth.  In  fact,  there  was  no 
bridewealth.  Men  could  not  use  money  to  acquire  women;  nor  could 
they  use  it  to  claim  any  rights  over  children.  The  Lele  were  matrilineal. 
Children  belonged  not  to  their  father's  clan,  but  to  their  mother's. 

There  was  another  way  that  men  gained  control  over  women, 
however.26  This  was  the  system  of  blood  debts. 

It  is  a  common  understanding  among  many  traditional  African 
peoples  that  human  beings  do  not  simply  die  without  a  reason.  If 
someone  dies,  someone  must  have  killed  them.  If  a  Lele  woman  died 
in  childbirth,  for  example,  this  was  assumed  to  be  because  she  had 
committed  adultery.  The  adulterer  was  thus  responsible  for  the  death. 
Sometimes  she  would  confess  on  her  deathbed,  otherwise  the  facts  of 
the  matter  would  have  to  be  established  through  divination.  It  was 
the  same  if  a  baby  died.  If  someone  became  sick,  or  slipped  and  fell 



while  climbing  a  tree,  one  would  check  to  see  if  they  had  been  involved 
in  any  quarrel  that  could  be  said  to  have  caused  the  misfortune.  If  all 
else  failed,  one  could  employ  magical  means  to  identify  the  sorcerer. 
Once  the  village  was  satisfied  that  a  culprit  had  been  identified,  that 
person  owed  a  blood-debt:  that  is,  he  owed  the  victim's  next  of  kin 
a  human  life.  The  culprit  would  thus  have  to  transfer  over  a  young 
woman  from  his  family,  his  sister  or  her  daughter,  to  be  the  victim's 
ward,  or  "pawn." 

As  with  the  Tiv,  the  system  quickly  became  immensely  compli- 
cated. Pawnship  was  inherited.  If  a  woman  was  someone's  pawn,  so 
would  her  children  be,  and  so  would  her  daughters'  children.  This 
meant  that  most  males  were  also  considered  someone  else's  man.  Still, 
no  one  would  accept  a  male  pawn  in  payment  of  blood-debts:  the 
whole  point  was  to  get  hold  of  a  young  woman,  who  would  then  go 
on  to  produce  additional  pawn  children.  Douglas's  Lele  informants 
emphasized  that  any  man  would  naturally  want  to  have  many  of  these 
as  possible: 

Ask  "Why  do  you  want  to  have  more  pawns?"  and  they  invari- 
ably say,  "The  advantage  of  owning  pawns  is  that  if  you  incur 
a  blood-debt,  you  can  settle  it  by  paying  one  of  your  pawns, 
and  your  own  sisters  remain  free."  Ask,  "Why  do  you  wish 
your  own  sisters  to  remain  free?"  and  they  reply,  "Ah!  then  if 
I  incur  a  blood-debt,  I  can  settle  it  by  giving  one  of  them  as 
a  pawn  ..." 

Every  man  is  always  aware  that  at  any  time  he  is  liable  for 
a  blood-debt.  If  any  woman  he  has  seduced  confesses  his  name 
in  the  throes  of  child-birth,  and  subsequently  dies,  or  if  her 
child  dies,  or  if  anyone  he  has  quarreled  with  dies  of  illness 
or  accident,  he  may  be  held  responsible  .  .  .  Even  if  a  woman 
runs  away  from  her  husband,  and  fighting  breaks  out  on  her 
account,  the  deaths  will  be  laid  at  her  door,  and  her  brother 
or  mother's  brother  will  have  to  pay  up.  Since  only  women 
are  accepted  as  blood-compensation,  and  since  compensation 
is  demanded  for  all  deaths,  of  men  as  well  as  of  women,  it  is 
obvious  that  there  can  never  be  enough  to  go  around.  Men  fall 
into  arrears  in  their  pawnship  obligations,  and  girls  used  to  be 
pledged  before  their  birth,  even  before  their  mothers  were  of 
marriageable  age.27 

In  other  words,  the  whole  thing  turned  into  an  endlessly  complicat- 
ed chess  game — one  reason,  Douglas  remarks,  why  the  term  "pawn" 



seems  singularly  apropos.  Just  about  every  adult  Lele  male  was  both 
someone  else's  pawn,  and  engaged  in  a  constant  game  of  securing, 
swapping,  or  redeeming  pawns.  Every  major  drama  or  tragedy  of  vil- 
lage life  would  ordinarily  lead  to  a  transfer  of  rights  in  women.  Almost 
all  of  those  women  would  eventually  get  swapped  again. 

Several  points  need  to  be  emphasized  here.  First  of  all,  what  were 
being  traded  were,  quite  specifically,  human  lives.  Douglas  calls  them 
"blood-debts,"  but  "life-debts"  would  be  more  appropriate.  Say,  for 
instance,  a  man  is  drowning,  and  another  man  rescues  him.  Or  say 
he's  deathly  ill  but  a  doctor  cures  him.  In  either  case,  we  would  likely 
say  one  man  "owes  his  life"  to  the  other.  So  would  the  Lele,  but  they 
meant  it  literally.  Save  someone's  life,  they  owe  you  a  life,  and  a  life 
owed  had  to  be  paid  back.  The  usual  recourse  was  for  a  man  whose  life 
was  saved  to  turn  over  his  sister  as  a  pawn — or  if  not  that,  a  different 
woman;  a  pawn  he  had  acquired  from  someone  else. 

The  second  point  is  that  nothing  could  substitute  for  a  human  life. 
"Compensation  was  based  on  the  principle  of  equivalence,  a  life  for  a 
life,  a  person  for  a  person."  Since  the  value  of  a  human  life  was  abso- 
lute, no  amount  of  raffia  cloth,  or  camwood  bars,  or  goats,  or  transis- 
tor radios,  or  anything  else  could  possibly  take  its  place. 

The  third  and  most  important  point  is  that  in  practice,  "human 
life"  actually  meant  "woman's  life" — or  even  more  specifically,  "young 
woman's  life."  Ostensibly  this  was  to  maximize  one's  holdings:  above 
all,  one  wished  for  a  human  being  who  could  become  pregnant  and 
produce  children,  since  those  children  would  also  be  pawns.  Still,  even 
Mary  Douglas,  who  was  in  no  sense  a  feminist,  was  forced  to  admit  that 
the  whole  arrangement  did  seem  to  operate  as  if  it  were  one  gigantic 
apparatus  for  asserting  male  control  over  women.  This  was  true  above 
all  because  women  themselves  could  not  own  pawns.28  They  could  only 
be  pawns.  In  other  words:  when  it  came  to  life-debts,  only  men  could 
be  either  creditors  or  debtors.  Young  women  were  thus  the  credits  and 
the  debits — the  pieces  being  moved  around  the  chessboard — while  the 
hands  that  moved  them  were  invariably  male.29 

Of  course,  since  almost  everyone  was  a  pawn,  or  had  been  at  some 
point  in  their  lives,  being  one  could  not  in  itself  be  much  of  a  tragedy. 
For  male  pawns  it  was  in  some  ways  quite  advantageous,  since  one's 
"owner"  had  to  pay  most  of  one's  fines  and  fees  and  even  blood-debts. 
This  is  why,  as  Douglas's  informants  uniformly  insisted,  pawnship  had 
nothing  in  common  with  slavery.  The  Lele  did  keep  slaves,  but  never 
very  many.  Slaves  were  war  captives,  usually  foreigners.  As  such  they 
had  no  family,  no  one  to  protect  them.  To  be  a  pawn,  on  the  other 
hand,  meant  to  have  not  one,  but  two  different  families  to  look  after 



you:  you  still  had  your  own  mother  and  her  brothers,  but  now  you  also 
had  your  "lord." 

For  a  woman,  the  very  fact  that  she  was  the  stakes  in  a  game  that 
all  men  were  playing  afforded  all  sorts  of  opportunities  to  game  the 
system.  In  principle,  a  girl  might  be  born  a  pawn,  assigned  to  some 
man  for  eventual  marriage.  In  practice,  however, 

a  little  Lele  girl  would  grow  up  a  coquette.  From  infancy  she 
was  the  centre  of  affectionate,  teasing,  flirting  attention.  Her 
affianced  husband  never  gained  more  than  a  very  limited  con- 
trol over  her  .  .  .  Since  men  competed  with  one  another  for 
women  there  was  scope  for  women  to  manoeuvre  and  intrigue. 
Hopeful  seducers  were  never  lacking  and  no  woman  doubted 
that  she  could  get  another  husband  if  it  suited  her.30 

In  addition,  a  young  Lele  woman  had  one  unique  and  powerful  card 
to  play.  Everyone  was  well  aware  that,  if  she  completely  refused  to 
countenance  her  situation,  she  always  had  the  option  of  becoming  a 

The  institution  of  village-wife  was  a  peculiarly  Lele  one.  Probably 
the  best  way  to  describe  it  is  to  imagine  a  hypothetical  case.  Let  us  say 
that  an  old,  important  man  acquires  a  young  woman  as  pawn  through 
a  blood-debt,  and  he  decides  to  marry  her  himself.  Technically,  he  has 
the  right  to  do  so,  but  it's  no  fun  for  a  young  woman  to  be  an  old 
man's  third  or  fourth  wife.  Or,  say  he  decides  to  offer  her  in  marriage 
to  one  of  his  male  pawns  in  a  village  far  away  from  her  mother  and 
natal  home.  She  protests.  He  ignores  her  protestations.  She  waits  for 
an  opportune  moment  and  slips  off  at  night  to  an  enemy  village,  where 
she  asks  for  sanctuary.  This  is  always  possible:  all  villages  have  their 
traditional  enemies.  Neither  would  an  enemy  village  refuse  a  woman 
who  came  to  them  in  such  a  situation.  They  would  immediately  de- 
clare her  "wife  of  the  village,"  who  all  men  living  there  would  then  be 
obliged  to  protect. 

It  helps  to  understand  that  here,  as  in  many  parts  of  Africa,  most 
older  men  had  several  wives.  This  meant  that  the  pool  of  women  avail- 
able for  younger  men  was  considerably  reduced.  As  our  ethnographer 
explains,  the  imbalance  was  a  source  of  considerable  sexual  tension: 

Everyone  recognized  that  the  young  unmarried  men  coveted 
the  wives  of  their  seniors.  Indeed,  one  of  their  pastimes  was  to 
plan  seductions  and  the  man  who  boasted  of  none  was  derided. 
Since  the  old  men  wished  to  remain  polygynists,  with  two  or 



three  wives,  and  since  adulteries  were  thought  to  disrupt  the 
peace  of  the  village,  Lele  had  to  make  some  arrangement  to 
appease  their  unmarried  men. 

Therefore,  when  a  sufficient  number  of  them  reached  the 
age  of  eighteen  or  so,  they  were  allowed  to  buy  the  right  to  a 
common  wife.32 

After  paying  an  appropriate  fee  in  raffia  cloth  to  the  village  treasury, 
they  were  permitted  to  build  a  collective  house,  and  then  they  were  ei- 
ther allotted  a  wife  to  put  in  it,  or  allowed  to  form  a  party  that  would 
try  to  steal  one  from  a  rival  village.  (Or,  alternately,  if  one  showed 
up  as  a  refugee,  they  would  ask  the  rest  of  the  village  for  the  right  to 
accept  her:  this  was  invariably  granted.)  This  common  wife  is  what's 
referred  to  as  a  "village  wife."  The  position  of  village  wife  was  more 
than  respectable.  In  fact,  a  newly  married  village  wife  was  treated  very 
much  like  a  princess.  She  was  not  expected  to  plant  or  weed  in  the 
gardens,  fetch  wood  or  water,  or  even  to  cook;  all  household  chores 
were  done  by  her  eager  young  husbands,  who  provided  the  best  of 
everything,  spending  much  of  their  time  hunting  in  the  forest  vying 
to  bring  her  the  choicest  delicacies,  or  plying  her  with  palm  wine.  She 
could  help  herself  to  others'  possessions  and  was  expected  to  make  all 
sorts  of  mischief  to  the  bemused  indulgence  of  all  concerned.  She  was 
also  expected  to  make  herself  sexually  available  to  all  members  of  the 
age-set — perhaps  ten  or  twelve  different  men — at  first,  pretty  much 
whenever  they  wanted  her.33 

Over  time,  a  village  wife  would  usually  settle  down  with  just  three 
or  four  of  her  husbands,  and  finally,  just  one.  The  domestic  arrange- 
ments were  flexible.  Nonetheless,  in  principle,  she  was  married  to  the 
village  as  a  whole.  If  she  had  children,  the  village  was  considered  to 
be  their  father,  and  as  such  expected  to  bring  them  up,  provide  them 
with  resources,  and  eventually,  get  them  properly  married  off — which 
is  why  villages  had  to  maintain  collective  treasuries  full  of  raffia  and 
camwood  bars  in  the  first  place.  Since  at  any  time  a  village  was  likely 
to  have  several  village  wives,  it  would  also  have  its  own  children  and 
grandchildren,  and  therefore  be  in  a  position  to  both  demand  and  pay 
blood-debts,  and  thus,  to  accumulate  pawns. 

As  a  result,  villages  became  corporate  bodies,  collective  groups 
that,  like  modern  corporations,  had  to  be  treated  as  if  they  were  indi- 
viduals for  purposes  of  law.  However  there  was  one  key  difference.  Un- 
like ordinary  individuals,  villages  could  back  up  their  claims  with  force. 

As  Douglas  emphasizes,  this  was  crucial,  because  ordinary  Lele 
men  were  simply  not  able  to  do  this  to  one  another.34  In  everyday 



affairs,  there  was  an  almost  complete  lack  of  any  systematic  means  of 
coercion.  This  was  the  main  reason,  she  notes,  that  pawnship  was  so 
innocuous.  There  were  all  sorts  of  rules,  but  with  no  government,  no 
courts,  no  judges  to  make  authoritative  decisions,  no  group  of  armed 
men  willing  or  able  to  employ  the  threat  of  force  to  back  those  deci- 
sions up,  rules  were  there  to  be  adjusted  and  interpreted.  In  the  end, 
everyone's  feelings  had  to  be  taken  into  account.  In  everyday  affairs, 
Lele  put  great  stock  on  gentle  and  agreeable  behavior.  Men  might  have 
been  regularly  seized  with  the  urge  to  throw  themselves  at  each  other  in 
fits  of  jealous  rage  (often  they  had  good  reason  to),  but  they  very  rarely 
did.  And  if  a  fight  did  break  out,  everyone  would  immediately  jump  in 
to  break  it  up  and  submit  the  affair  to  public  mediation.'5 

Villages,  in  contrast,  were  fortified,  and  age-sets  could  be  mobilized 
to  act  as  military  units.  Here,  and  only  here,  did  organized  violence 
enter  the  picture.  True,  when  villages  fought,  it  was  also  always  over 
women  (everyone  Douglas  talked  to  expressed  incredulity  at  the  very 
idea  that  grown  men,  anywhere,  could  ever  come  to  blows  over  any- 
thing else).  But  in  the  case  of  villages,  it  could  come  to  an  actual  war. 
If  another  village's  elders  ignored  one's  claims  to  a  pawn,  one's  young 
men  might  organize  a  raiding  party  and  kidnap  her,  or  carry  off  some 
other  likely  young  women  to  be  their  collective  wife.  This  might  lead 
to  deaths,  and  to  further  claims  for  compensation.  "Since  it  had  the 
backing  of  force,"  Douglas  observes  drily,  "the  village  could  afford  to 
be  less  conciliatory  towards  the  wishes  of  its  pawns."36 

It's  at  exactly  this  point,  too,  where  the  potential  for  violence 
enters,  that  the  great  wall  constructed  between  the  value  of  lives  and 
money  can  suddenly  come  tumbling  down. 

Sometimes  when  two  clans  were  disputing  a  claim  to  blood 
compensation,  the  claimant  might  see  no  hope  of  getting  sat- 
isfaction from  his  opponents.  The  political  system  offered  no 
direct  means  for  one  man  (or  clan)  to  use  physical  coercion  or 
to  resort  to  superior  authority  to  enforce  claims  against  an- 
other. In  such  a  case,  rather  than  abandon  his  claim  to  a  pawn- 
woman,  he  would  be  ready  to  take  the  equivalent  in  wealth,  if 
he  could  get  it.  The  usual  procedure  was  to  sell  his  case  against 
the  defendants  to  the  only  group  capable  of  extorting  a  pawn 
by  force,  that  is,  to  a  village. 

The  man  who  meant  to  sell  his  case  to  a  village  asked  them 
for  100  raffia  cloths  or  five  bars  of  camwood.  The  village  raised 
the  amount,  either  from  its  treasury,  or  by  a  loan  from  one 



of  its  members,  and  thereby  adopted  as  its  own  his  claim  to 
a  pawn.37 

Once  he  held  the  money,  his  claim  was  over,  and  the  village,  which  had 
now  bought  it,  would  proceed  to  organize  a  raid  to  seize  the  woman 
in  dispute. 

In  other  words,  it  was  only  when  violence  was  brought  into  the 
equation  that  there  was  any  question  of  buying  and  selling  people.  The 
ability  to  deploy  force,  to  cut  through  the  endless  maze  of  preferences, 
obligations,  expectations,  and  responsibilities  that  mark  real  human 
relationships,  also  made  it  possible  to  overcome  what  is  otherwise  the 
first  rule  of  all  Lele  economic  relationships:  that  human  lives  can  only 
be  exchanged  for  other  human  lives,  and  never  for  physical  objects. 
Significantly,  the  amount  paid — a  hundred  cloths,  or  an  equivalent 
amount  of  camwood — was  also  the  price  of  a  slave.38  Slaves  were,  as 
I  mentioned,  war  captives.  There  seem  never  to  have  been  very  many 
of  them;  Douglas  only  managed  to  locate  two  descendants  of  slaves 
in  the  1950s,  some  twenty-five  years  after  the  practice  had  been  abol- 
ished.39 Still,  the  numbers  were  not  important.  The  mere  fact  of  their 
existence  set  a  precedent.  The  value  of  a  human  life  could,  sometimes, 
be  quantified;  but  if  one  was  able  to  move  from  A  =  A  (one  life  equals 
another)  to  A  =  B  (one  life  =  one  hundred  cloths),  it  was  only  because 
the  equation  was  established  at  the  point  of  a  spear. 

Flesh-Debt  (Tiv) 

I  have  dwelt  on  the  Lele  in  such  detail  in  part  because  I  wanted  to  con- 
vey some  sense  of  why  I  was  using  the  term  "human  economy,"  what 
life  is  like  inside  one,  what  sort  of  dramas  fill  people's  days,  and  how 
money  typically  operates  in  the  midst  of  all  this.  Lele  currencies  are, 
as  I  say,  quintessential  social  currencies.  They  are  used  to  mark  every 
visit,  every  promise,  every  important  moment  in  a  man's  or  woman's 
life.  It  is  surely  significant,  too,  what  the  objects  used  as  currency  here 
actually  were.  Raffia  cloth  was  used  for  clothing.  In  Douglas's  day, 
it  was  the  main  thing  used  to  clothe  the  human  body;  camwood  bars 
were  the  source  of  a  red  paste  that  was  used  as  a  cosmetic — it  was  the 
main  substance  used  as  makeup,  by  both  men  and  women,  to  beautify 
themselves  each  day.  These,  then,  were  the  materials  used  to  shape 
people's  physical  appearance,  to  make  them  appear  mature,  decent,  at- 
tractive, and  dignified  to  their  fellows.  They  were  what  turned  a  mere 
naked  body  into  a  proper  social  being. 



This  is  no  coincidence.  In  fact,  it's  extraordinarily  common  in 
what  I've  been  calling  human  economies.  Money  almost  always  arises 
first  from  objects  that  are  used  primarily  as  adornment  of  the  person. 
Beads,  shells,  feathers,  dog  or  whale  teeth,  gold,  and  silver  are  all  well- 
known  cases  in  point.  All  are  useless  for  any  purpose  other  than  mak- 
ing people  look  more  interesting,  and  hence,  more  beautiful.  The  brass 
rods  used  by  the  Tiv  might  seem  an  exception,  but  actually  they're  not: 
they  were  used  mainly  as  raw  material  for  the  manufacture  of  jewelry, 
or  simply  twisted  into  hoops  and  worn  at  dances.  There  are  exceptions 
(cattle,  for  instance),  but  as  a  general  rule,  it's  only  when  governments, 
and  then  markets,  enter  the  picture  that  we  begin  to  see  currencies  like 
barley,  cheese,  tobacco,  or  salt.40 

It  also  illustrates  the  peculiar  progression  of  ideas  that  so  often 
mark  human  economies.  On  the  one  hand,  human  life  is  the  absolute 
value.  There  is  no  possible  equivalent.  Whether  a  life  is  given  or  taken, 
the  debt  is  absolute.  In  places,  this  principle  is  indeed  sacrosanct.  More 
often,  it  is  compromised  by  the  elaborate  games  played  by  the  Tiv,  who 
treat  the  giving  of  lives,  and  the  Lele,  who  treat  the  taking  of  lives, 
as  creating  debts  that  can  only  be  paid  by  delivering  another  human 
being.  In  each  case,  too,  the  practice  ends  up  engendering  an  extraor- 
dinarily complex  game  in  which  important  men  end  up  exchanging 
women,  or  at  least,  rights  over  their  fertility. 

But  this  is  already  a  kind  of  opening.  Once  the  game  exists,  once 
the  principle  of  substitution  comes  in,  there  was  always  the  possibility 
of  extending  it.  When  that  begins  to  happen,  systems  of  debt  that  were 
premised  on  creating  people  can — even  here — suddenly  become  the 
means  of  destroying  them. 

As  an  example,  let  us  once  again  return  to  the  Tiv.  The  reader  will 
recall  that  if  a  man  did  not  have  a  sister  or  a  ward  to  give  in  exchange 
for  one's  wife,  it  was  possible  to  assuage  her  parents  and  guardians  by 
gifts  of  money.  However,  such  a  wife  would  never  be  considered  truly 
his.  Here  too,  there  was  one  dramatic  exception.  A  man  could  buy  a 
slave,  a  woman  kidnapped  in  a  raid  from  a  distant  country.41  Slaves, 
after  all,  had  no  parents,  or  could  be  treated  as  if  they  didn't;  they  had 
been  forcibly  removed  from  all  those  networks  of  mutual  obligation 
and  debt  in  which  ordinary  people  acquired  their  outward  identities. 
This  was  why  they  could  be  bought  and  sold. 

Once  married,  though,  a  purchased  wife  would  quickly  develop 
new  ties.  She  was  no  longer  a  slave,  and  her  children  were  perfectly 
legitimate — more  so,  in  fact,  than  those  of  a  wife  who  was  merely  ac- 
quired through  the  continual  payment  of  brass  rods. 



We  have  perhaps  a  general  principle:  to  make  something  saleable, 
in  a  human  economy,  one  needs  to  first  rip  it  from  its  context.  That's 
what  slaves  are:  people  stolen  from  the  community  that  made  them 
what  they  are.  As  strangers  to  their  new  communities,  slaves  no  longer 
had  mothers,  fathers,  kin  of  any  sort.  This  is  why  they  could  be  bought 
and  sold  or  even  killed:  because  the  only  relation  they  had  was  to  their 
owners.  A  Lele  village's  ability  to  organize  raids  and  kidnap  a  woman 
from  an  alien  community  seems  to  have  been  the  key  to  its  ability  to 
start  trading  women  for  money — even  if  in  their  case,  they  could  do  so 
only  to  a  very  limited  extent.  After  all,  her  relatives  were  not  very  far 
away,  and  they  would  surely  come  around  demanding  an  explanation. 
In  the  end,  someone  would  have  to  come  up  with  an  arrangement  that 
everyone  could  live  with.42 

Still,  I  would  also  insist  that  there  is  something  more  than  this. 
One  gets  the  distinct  sense,  in  much  of  the  literature,  that  many  African 
societies  were  haunted  by  the  awareness  that  these  elaborate  networks 
of  debt  could,  if  things  went  just  slightly  wrong,  be  transformed  into 
something  absolutely  terrible.  The  Tiv  are  a  dramatic  case  in  point. 

Among  students  of  anthropology,  the  Tiv  are  mainly  famous  for  the 
fact  that  their  economic  life  was  divided  into  what  their  best-known 
ethnographers,  Paul  and  Laura  Bohannan,  referred  to  as  three  sepa- 
rate "spheres  of  exchange."  Ordinary,  everyday  economic  activity  was 
mostly  the  affair  of  women.  They  were  the  ones  who  filled  the  markets, 
and  who  trod  the  paths  giving  and  returning  minor  gifts  of  okra,  nuts, 
or  fish.  Men  concerned  themselves  with  what  they  considered  higher 
things:  the  kind  of  transactions  that  could  be  conducted  using  the  Tiv 
currency,  which,  as  with  the  Lele,  consisted  of  two  denominations,  a 
kind  of  locally  made  cloth  called  tugudu,  widely  exported,  and,  for  ma- 
jor transactions,  bundles  of  imported  brass  rods.43  These  could  be  used 
to  acquire  certain  flashy  and  luxurious  things  (cows,  purchased  foreign 
wives),  but  they  were  mainly  for  the  give  and  take  of  political  affairs, 
hiring  curers,  acquiring  magic,  gaining  initiation  into  cult  societies.  In 
political  matters,  Tiv  were  even  more  resolutely  egalitarian  than  the 
Lele:  successful  old  men  with  their  numerous  wives  might  have  lorded 
it  over  their  sons  and  other  dependants  within  their  own  house  com- 
pounds, but  beyond  that,  there  was  no  formal  political  organization 
of  any  sort.  Finally,  there  was  the  system  of  wards,  which  consisted 
entirely  of  men's  rights  in  women.  Hence,  the  notion  of  "spheres."  In 
principle,  these  three  levels — ordinary  consumption  goods,  masculine 



prestige  goods,  and  rights  in  women — were  completely  separate.  No 
amount  of  okra  could  get  you  a  brass  rod,  just  as,  in  principle,  no 
number  of  brass  rods  could  give  you  full  rights  to  a  woman. 

In  practice,  there  were  ways  to  game  the  system.  Say  a  neighbor 
was  sponsoring  a  feast  but  was  short  on  supplies;  one  might  come  to 
his  aid,  then  later,  discreetly,  ask  for  a  bundle  or  two  in  repayment.  To 
be  able  to  wheel  and  deal,  to  "turn  chickens  into  cows,"  as  the  saying 
went,  and  ultimately,  broker  one's  wealth  and  prestige  into  a  way  of 
acquiring  wives,  required  a  "strong  heart" — that  is,  an  enterprising  and 
charismatic  personality.44  But  "strong  heart"  had  another  meaning  too. 
There  was  believed  to  be  a  certain  actual  biological  substance  called 
tsav  that  grew  on  the  human  heart.  This  was  what  gave  certain  people 
their  charm,  their  energy,  and  their  powers  of  persuasion.  Tsav  there- 
fore was  both  a  physical  substance  and  that  invisible  power  that  allows 
certain  people  to  bend  others  to  their  will.45 

The  problem  was — and  most  Tiv  of  that  time  appear  to  have  be- 
lieved that  this  was  the  problem  with  their  society — that  it  was  also 
possible  to  augment  one's  tsav  through  artificial  means,  and  this  could 
only  be  accomplished  by  consuming  human  flesh. 

Now,  I  should  emphasize  right  away  that  there  is  no  reason  to  be- 
lieve that  any  Tiv  actually  did  practice  cannibalism.  The  idea  of  eating 
human  flesh  appears  to  have  disgusted  and  horrified  them  as  much  as 
it  would  most  Americans.  Yet  for  centuries,  most  appear  to  have  been 
veritably  obsessed  by  the  suspicion  that  some  of  their  neighbors — and 
particularly  prominent  men  who  became  de  facto  political  leaders — 
were,  in  fact,  secret  cannibals.  Men  who  built  up  their  tsav  by  such 
means,  the  stories  went,  attained  extraordinary  powers:  the  ability  to 
fly,  to  become  impervious  to  weapons,  to  be  able  to  send  out  their 
souls  at  night  to  kill  their  victims  in  such  a  way  that  their  victims  did 
not  even  know  that  they  were  dead,  but  would  wander  about,  confused 
and  feckless,  to  be  harvested  for  their  cannibal  feasts.  They  became,  in 
short,  terrifying  witches.46 

The  mbatsav,  or  society  of  witches,  was  always  looking  for  new 
members,  and  the  way  to  accomplish  this  was  to  trick  people  into  eat- 
ing human  flesh.  A  witch  would  take  a  piece  of  the  body  of  one  of  his 
own  close  relatives,  who  he  had  murdered,  and  place  it  in  the  victim's 
food.  If  the  man  was  foolish  enough  to  eat  it,  he  would  contract  a 
"flesh-debt,"  and  the  society  of  witches  ensured  that  flesh-debts  are 
always  paid. 

Perhaps  your  friend,  or  some  older  man,  has  noticed  that  you 
have  a  large  number  of  children,  or  brothers  and  sisters,  and  so 



tricks  you  into  contracting  the  debt  with  him.  He  invites  you 
to  eat  food  in  his  house  alone  with  him,  and  when  you  begin 
the  meal  he  sets  before  you  two  dishes  of  sauce,  one  of  which 
contains  cooked  human  flesh  .  .  . 

If  you  eat  from  the  wrong  dish,  but  you  do  not  have  a  "strong 
heart" — the  potential  to  become  a  witch — you  will  become  sick  and 
flee  from  the  house  in  terror.  But  if  you  have  that  hidden  potential,  the 
flesh  will  begin  to  work  in  you.  That  evening,  you  will  find  your  house 
surrounded  by  screeching  cats  and  owls.  Strange  noises  will  fill  the  air. 
Your  new  creditor  will  appear  before  you,  backed  by  his  confederates 
in  evil.  He  will  tell  of  how  he  killed  his  own  brother  so  you  two  could 
dine  together,  and  pretend  to  be  tortured  by  the  thought  of  having  lost 
his  own  kin  as  you  sit  there,  surrounded  by  your  plump  and  healthy 
relatives.  The  other  witches  will  concur,  acting  as  if  all  this  is  your  own 
fault.  "You  have  sought  for  trouble,  and  trouble  has  come  upon  you. 
Come  and  lie  down  on  the  ground,  that  we  may  cut  your  throat."47 

There's  only  one  way  out,  and  that's  to  pledge  a  member  of  your 
own  family  as  substitute.  This  is  possible,  because  you  will  find  you 
have  terrible  new  powers,  but  they  must  be  used  as  the  other  witches 
demand.  One  by  one,  you  must  kill  off  your  brothers,  sisters,  children; 
their  bodies  will  be  stolen  from  their  graves  by  the  college  of  witches, 
brought  back  to  life  just  long  enough  to  be  properly  fattened,  tortured, 
killed  again,  then  carved  and  roasted  for  yet  another  feast. 

The  flesh  debt  goes  on  and  on.  The  creditor  keeps  on  coming. 
Unless  the  debtor  has  men  behind  him  who  are  very  strong  in 
tsav,  he  cannot  free  himself  from  the  flesh  debt  until  he  has 
given  up  all  his  people,  and  his  family  is  finished.  Then  he  goes 
himself  and  lies  down  on  the  ground  to  be  slaughtered,  and  so 
the  debt  is  finally  discharged.48 

The  Slave  Trade 

In  one  sense,  it's  obvious  what's  going  on  here.  Men  with  "strong 
hearts"  have  power  and  charisma;  using  it,  they  can  manipulate  debt 
to  turn  extra  food  into  treasures,  and  treasures  into  wives,  wards,  and 
daughters,  and  thus  become  the  heads  of  ever-growing  families.  But 
that  very  power  and  charisma  that  allows  them  to  do  this  also  makes 
them  run  the  constant  danger  of  sending  the  whole  process  jolting  back 



into  a  kind  of  horrific  implosion,  of  creating  flesh-debts  whereby  one's 
family  is  converted  back  into  food. 

Now,  if  one  is  simply  trying  to  imagine  the  worst  thing  that  could 
possibly  happen  to  someone,  surely,  being  forced  to  dine  on  the  mu- 
tilated corpses  of  one's  own  children  would,  anywhere,  be  pretty  high 
on  the  list.  Still,  anthropologists  have  come  to  understand,  over  the 
years,  that  every  society  is  haunted  by  slightly  different  nightmares, 
and  these  differences  are  significant.  Horror  stories,  whether  about 
vampires,  ghouls,  or  flesh-eating  zombies,  always  seem  to  reflect  some 
aspect  of  the  tellers'  own  social  lives,  some  terrifying  potential,  in  the 
way  they  are  accustomed  to  interact  with  each  other,  that  they  do  not 
wish  to  acknowledge  or  confront,  but  also  cannot  help  but  talk  about.49 

In  the  Tiv  case,  what  would  that  be?  Clearly,  Tiv  did  have  a  major 
problem  with  authority.  They  lived  in  a  landscape  dotted  with  com- 
pounds, each  organized  around  a  single  older  man  with  his  numerous 
wives,  children,  and  assorted  hangers-on.  Within  each  compound,  that 
man  had  near-absolute  authority.  Outside  there  was  no  formal  political 
structure,  and  Tiv  were  fiercely  egalitarian.  In  other  words:  all  men  as- 
pired to  become  the  masters  of  large  families,  but  they  were  extremely 
suspicious  of  any  form  of  mastery.  Hardly  surprising,  then,  that  Tiv 
men  were  so  ambivalent  about  the  nature  of  power  that  they  became 
convinced  that  the  very  qualities  that  allow  a  man  to  rise  to  legitimate 
prominence  could,  if  taken  just  a  little  bit  further,  turn  him  into  a  mon- 
ster.50 In  fact,  most  Tiv  seemed  to  assume  that  most  male  elders  were 
witches,  and  that  if  a  young  person  died,  they  were  probably  being  paid 
off  for  a  flesh-debt. 

But  this  still  doesn't  answer  the  one  obvious  question:  Why  is  all 
this  framed  in  terms  of  debt? 

Here  a  little  history  is  in  order.  It  would  appear  that  the  ancestors  of 
the  Tiv  arrived  in  the  Benue  river  valley  and  adjacent  lands  sometime 
around  1750 — a  time  when  all  of  what's  now  Nigeria  was  being  torn 
apart  by  the  Atlantic  slave  trade.  Early  stories  relate  how  the  Tiv,  dur- 
ing their  migrations,  used  to  paint  their  wives  and  children  with  what 
looked  like  smallpox  scars,  so  that  potential  raiders  would  be  afraid  to 
carry  them  off.51  They  established  themselves  in  a  notoriously  inacces- 
sible stretch  of  country  and  offered  up  ferocious  defense  against  peri- 
odic raids  from  neighboring  kingdoms  to  their  north  and  west — with 
which  they  eventually  came  to  a  political  rapprochement.52 



The  Tiv,  then,  were  well  aware  of  what  was  happening  all  around 
them.  Consider,  for  example,  the  case  of  the  copper  bars  whose  use 
they  were  so  careful  to  restrict,  so  as  to  avoid  their  becoming  an  all- 
purpose  form  of  currency. 

Now,  copper  bars  had  been  used  for  money  in  this  part  of  Africa 
for  centuries,  and  at  least  in  some  places,  for  ordinary  commercial 
transactions,  as  well.  It  was  easy  enough  to  do:  one  simply  snapped 
them  apart  into  smaller  pieces,  or  pulled  some  of  them  into  thin  wires, 
twisted  those  around  to  little  loops,  and  one  had  perfectly  serviceable 
small  change  for  everyday  market  transactions.53  Most  of  the  ones  cur- 
rent in  Tivland  since  the  late  eighteenth  century,  on  the  other  hand, 
were  mass-produced  in  factories  in  Birmingham  and  imported  through 
the  port  of  Old  Calabar  at  the  mouth  of  the  Cross  River,  by  slave- 
traders  based  in  Liverpool  and  Bristol.54  In  all  the  country  adjoining 
the  Cross  River — that  is,  in  the  region  directly  to  the  south  of  the 
Tiv  territory — copper  bars  were  used  as  everyday  currency.  This  was 
presumably  how  they  entered  Tivland;  they  were  either  carried  in  by 
pedlars  from  the  Cross  River  or  acquired  by  Tiv  traders  on  expeditions 
abroad.  All  this,  however,  makes  the  fact  that  the  Tiv  refused  to  use 
copper  bars  as  such  a  currency  doubly  significant. 

During  the  1760s  alone,  perhaps  a  hundred  thousand  Africans  were 
shipped  down  the  Cross  River  to  Calabar  and  nearby  ports,  where  they 
were  put  in  chains,  placed  on  British,  French,  or  other  European  ships, 
and  shipped  across  the  Atlantic — part  of  perhaps  a  million  and  a  half 
exported  from  the  Bight  of  Biafra  during  the  whole  period  of  the  At- 
lantic slave  trade.55  Some  of  them  had  been  captured  in  wars  or  raids, 
or  simply  kidnapped.  The  majority,  though,  were  carried  off  because 
of  debts. 

Here,  though,  I  must  explain  something  about  the  organization  of 
the  slave  trade. 

The  Atlantic  Slave  Trade  as  a  whole  was  a  gigantic  network  of 
credit  arrangements.  Ship-owners  based  in  Liverpool  or  Bristol  would 
acquire  goods  on  easy  credit  terms  from  local  wholesalers,  expecting  to 
make  good  by  selling  slaves  (also  on  credit)  to  planters  in  the  Antilles 
and  America,  with  commission  agents  in  the  city  of  London  ultimately 
financing  the  affair  through  the  profits  of  the  sugar  and  tobacco  trade.56 
Ship-owners  would  then  transport  their  wares  to  African  ports  like 
Old  Calabar.  Calabar  itself  was  the  quintessential  mercantile  city-state, 
dominated  by  rich  African  merchants  who  dressed  in  European  clothes, 
lived  in  European-style  houses,  and  in  some  cases  even  sent  their  chil- 
dren to  England  to  be  educated. 



On  arrival,  European  traders  would  negotiate  the  value  of  their 
cargoes  in  the  copper  bars  that  served  as  the  currency  of  the  port.  In 
1698,  a  merchant  aboard  a  ship  called  the  Dragon  noted  the  following 
prices  he  managed  to  establish  for  his  wares: 

one  bar  iron  4  copper  bars 

one  bunch  of  beads  4  copper  bars 

five  rangoes57  4  copper  bars 

one  basin  No.  1  4  copper  bars 

one  tankard  3  copper  bars 

one  yard  linen  1  copper  bar 

six  knives  1  copper  bar 


one  brass  bell  No.  1       3  copper  bars 

By  the  height  of  the  trade  fifty  years  later,  British  ships  were  bring- 
ing in  large  quantities  of  cloth  (both  products  of  the  newly  created 
Manchester  mills  and  calicoes  from  India),  and  iron  and  copper  ware, 
along  with  incidental  goods  like  beads,  and  also,  for  obvious  reasons, 
substantial  numbers  of  firearms.''9  The  goods  were  then  advanced  to 
African  merchants,  again  on  credit,  who  assigned  them  to  their  own 
agents  to  move  upstream. 

The  obvious  problem  was  how  to  secure  the  debt.  The  trade  was 
an  extraordinarily  duplicitous  and  brutal  business,  and  slave  raiders 
were  unlikely  to  be  dependable  credit  risks — especially  when  dealing 
with  foreign  merchants  who  they  might  never  see  again.60  As  a  result, 
a  system  quickly  developed  in  which  European  captains  would  demand 
security  in  the  form  of  pawns. 

The  sort  of  "pawns"  we  are  talking  about  here  are  clearly  quite 
different  from  the  kind  we  encountered  among  the  Lele.  In  many  of 
the  kingdoms  and  trading  towns  of  West  Africa,  the  nature  of  pawn- 
ship  appears  to  have  already  undergone  profound  changes  by  the  time 
Europeans  showed  up  on  the  scene  around  1500 — it  had  become,  effec- 
tively, a  kind  of  debt  peonage.  Debtors  would  pledge  family  members 
as  surety  for  loans;  the  pawns  would  then  become  dependents  in  the 
creditors'  households,  working  their  fields  and  tending  to  their  house- 
hold chores — their  persons  acting  as  security  while  their  labor,  effec- 
tively, substituted  for  interest.61  Pawns  were  not  slaves;  they  were  not, 
like  slaves,  cut  off  from  their  families;  but  neither  were  they  precisely 
free.62  In  Calabar  and  other  ports,  masters  of  slaving  ships,  on  advanc- 
ing goods  to  their  African  counterparts,  soon  developed  the  custom  of 



demanding  pawns  as  security — for  instance,  two  of  the  merchants'  own 
dependents  for  every  three  slaves  to  be  delivered,  preferably  including 
at  least  one  member  of  the  merchants'  families.63  This  was  in  practice 
not  much  different  than  demanding  the  surrender  of  hostages,  and  at 
times  it  created  major  political  crises  when  captains,  tired  of  waiting 
for  delayed  shipments,  decided  to  take  off  with  a  cargo  of  pawns  in- 

Upriver,  debt  pawns  also  played  a  major  part  in  the  trade.  In  one 
way,  the  area  was  a  bit  unusual.  In  most  of  West  Africa,  the  trade  ran 
through  major  kingdoms  such  as  Dahomey  or  Asante  to  make  wars 
and  impose  draconian  punishments — one  very  common  expedient  for 
rulers  was  to  manipulate  the  justice  system,  so  that  almost  any  crime 
came  to  be  punishable  by  enslavement,  or  by  death  with  the  enslave- 
ment of  one's  wife  and  children,  or  by  outrageously  high  fines  which, 
if  one  could  not  pay  them,  would  cause  the  defaulter  and  his  family  to 
be  sold  as  slaves.  In  another  way,  it  is  unusually  revealing,  since  the 
lack  of  any  larger  government  structures  made  it  easier  to  see  what 
was  really  happening.  The  pervasive  climate  of  violence  led  to  the  sys- 
tematic perversion  of  all  the  institutions  of  existing  human  economies, 
which  were  transformed  into  a  gigantic  apparatus  of  dehumanization 
and  destruction. 

In  the  Cross  River  region,  the  trade  seems  to  have  seen  two  phases. 
The  first  was  a  period  of  absolute  terror  and  utter  chaos,  in  which 
raids  were  frequent,  and  anyone  traveling  alone  risked  being  kidnapped 
by  roving  gangs  of  thugs  and  sold  to  Calabar.  Before  long,  villages 
lay  abandoned;  many  people  fled  into  the  forest;  men  would  have  to 
form  armed  parties  to  work  the  fields.64  This  period  was  relatively 
brief.  The  second  began  when  representatives  of  local  merchant  soci- 
eties began  to  establish  themselves  in  communities  up  and  down  the 
region,  offering  to  restore  order.  The  most  famous  of  these  was  the 
Aro  Confederacy,  who  called  themselves,  "Children  of  God."65  Backed 
by  heavily  armed  mercenaries  and  the  prestige  of  their  famous  Oracle 
at  Arochukwu,  they  established  a  new  and  notoriously  harsh  justice 
system.66  Kidnappers  were  hunted  down  and  themselves  sold  as  slaves. 
Safety  was  restored  to  roads  and  farmsteads.  At  the  same  time,  Aro 
collaborated  with  local  elders  to  create  a  code  of  ritual  laws  and  penal- 
ties so  comprehensive  and  severe  that  everyone  was  at  constant  risk  of 
falling  afoul  of  them.67  Anyone  who  violated  one  would  be  turned  over 
to  the  Aro  for  transport  to  the  coast,  with  their  accuser  receiving  their 
price  in  copper  bars.68  According  to  some  contemporary  accounts,  a 
man  who  simply  disliked  his  wife  and  was  in  need  of  brass  rods  could 



always  come  up  with  some  reason  to  sell  her,  and  the  village  elders — 
who  received  a  share  of  the  profits — would  almost  invariably  concur.69 
The  most  ingenious  trick  of  the  merchant  societies,  though,  was  to 
assist  in  the  dissemination  of  a  secret  society,  called  Ekpe.  Ekpe  was 
most  famous  for  sponsoring  magnificent  masquerades  and  for  initiat- 
ing its  members  into  arcane  mysteries,  but  it  also  acted  as  a  secret 
mechanism  for  the  enforcement  of  debts.70  In  Calabar  itself,  for  ex- 
ample, the  Ekpe  society  had  access  to  a  whole  range  of  sanctions, 
starting  with  boycotts  (all  members  were  forbidden  to  conduct  trade 
with  a  defaulting  debtor),  fines,  seizure  of  property,  arrest,  and  finally, 
execution — with  the  most  hapless  victims  left  tied  to  trees,  their  lower 
jaws  removed,  as  a  warning  to  others.71  It  was  ingenious,  particularly, 
because  such  societies  always  allowed  anyone  to  buy  in,  rising  though 
the  nine  initiatory  grades  if  they  could  pay  the  fee — these  also  exacted, 
of  course,  in  the  brass  rods  the  merchants  themselves  supplied.  In  Cala- 
bar, the  fee  schedule  for  each  grade  looked  like  this:72 

In  other  words,  it  was  quite  expensive.  But  membership  quickly 
became  the  chief  mark  of  honor  and  distinction  everywhere.  Entry  fees 
were  no  doubt  less  exorbitant  in  small,  distant  communities,  but  the 
effect  was  still  the  same:  thousands  ended  up  in  debt  to  the  merchants, 
whether  for  the  fees  required  for  joining,  or  for  the  trade  goods  they 
supplied  (mostly  cloth  and  metal  put  to  use  creating  the  gear  and 
costumes  for  the  Ekpe  performances — debts  that  they  thus  themselves 
became  responsible  for  enforcing  on  themselves.  These  debts,  too,  were 
regularly  paid  in  people,  ostensibly  yielded  up  as  pawns.) 

How  did  it  work  in  practice?  It  appears  to  have  varied  a  great  deal 
from  place  to  place.  In  the  Afikpo  district,  on  a  remote  part  of  the  up- 
per Cross  River,  for  instance,  we  read  that  everyday  affairs — the  acqui- 
sition of  food,  for  example — was  conducted,  as  among  the  Tiv,  "with- 
out trade  or  the  use  of  money."  Brass  rods,  supplied  by  the  merchant 
societies,  were  used  to  buy  and  sell  slaves,  but  otherwise  mostly  as  a 

i.  Nyampi 
2.  Oku  Akana 

3.  Brass 
4.  Makanda 
5.  Makara 

6.  Mboko  Mboko 

7.  Bunko  Abonko 
8.  Mboko  Nya  Ekpo 

9.  Ekpe 

50  boxes  brass  rods  for  each 
of  the  lower  grades. 



social  currency,  "used  for  gifts  and  for  payments  in  funerals,  titles,  and 
other  ceremonies."73  Most  of  those  payments,  titles,  and  ceremonies 
were  tied  to  the  secret  societies  that  the  merchants  had  also  brought 
to  the  area.  All  this  does  sound  a  bit  like  the  Tiv  arrangement,  but  the 
presence  of  the  merchants  ensured  that  the  effects  were  very  different: 

In  the  old  days,  if  anybody  got  into  trouble  or  debt  in  the  up- 
per parts  of  the  Cross  River,  and  wanted  ready  money,  he  used 
generally  to  "pledge"  one  or  more  of  his  children,  or  some 
other  members  of  his  family  or  household,  to  one  of  the  Aku- 
nakuna  traders  who  paid  periodical  visits  to  his  village.  Or  he 
would  make  a  raid  on  some  neighboring  village,  seize  a  child, 
and  sell  him  or  her  to  the  same  willing  purchaser.74 

The  passage  only  makes  sense  if  one  recognizes  that  debtors  were 
also,  owing  to  their  membership  in  the  secret  societies,  collectors.  The 
seizing  of  a  child  is  a  reference  to  the  local  practice  of  "panyarring," 
current  throughout  West  Africa,  by  which  creditors  despairing  of  repay- 
ment would  simply  sweep  into  the  debtor's  community  with  a  group  of 
armed  men  and  seize  anything — people,  goods,  domestic  animals — that 
could  be  easily  carried  off,  then  hold  it  hostage  as  security.75  It  didn't 
matter  if  the  people  or  goods  had  belonged  to  the  debtor,  or  even  the 
debtor's  relatives.  A  neighbor's  goats  or  children  would  do  just  as  well, 
since  the  whole  point  was  to  bring  social  pressure  on  whoever  owed 
the  money.  As  William  Bosman  put  it,  "If  the  Debtor  be  an  honest  man 
and  the  Debt  just,  he  immediately  endeavours  by  the  satisfaction  of  his 
Creditors  to  free  his  Countrymen."76  It  was  actually  a  quite  sensible 
expedient  in  an  environment  with  no  central  authority,  where  people 
tended  to  feel  an  enormous  sense  of  responsibility  toward  other  mem- 
bers of  their  community  and  very  little  responsibility  toward  anyone 
else.  In  the  case  of  the  secret  society  cited  above,  the  debtor  would, 
presumably,  be  calling  in  his  own  debts — real  or  imagined — to  those 
outside  the  organization,  in  order  not  to  have  to  send  off  members  of 
his  own  family.77 

Such  expedients  were  not  always  effective.  Often  debtors  would  be 
forced  to  pawn  more  and  more  of  their  own  children  or  dependents, 
until  finally  there  was  no  recourse  but  to  pawn  themselves.78  And  of 
course,  at  the  height  of  the  slave  trade,  "pawning"  had  become  little 
more  than  a  euphemism.  The  distinction  between  pawns  and  slaves 
had  largely  disappeared.  Debtors,  like  their  families  before  them,  ended 
up  turned  over  to  the  Aro,  then  to  the  British,  and  finally,  shackled  and 



chained,  crowded  into  tiny  slaving  vessels  and  sent  off  to  be  sold  on 
plantations  across  the  sea.79 

If  the  Tiv,  then,  were  haunted  by  the  vision  of  an  insidious  secret  orga- 
nization that  lured  unsuspecting  victims  into  debt  traps,  whereby  they 
themselves  became  the  enforcers  of  debts  to  be  paid  with  the  bodies 
of  their  children,  and  ultimately,  themselves — one  reason  was  because 
this  was,  literally  happening  to  people  who  lived  a  few  hundred  miles 
away.  Nor  is  the  use  of  the  phrase  "flesh-debt"  in  any  way  inappropri- 
ate. Slave-traders  might  not  have  been  reducing  their  victims  to  meat, 
but  they  were  certainly  reducing  them  to  nothing  more  than  bodies.  To 
be  a  slave  was  to  be  plucked  from  one's  family,  kin,  friends,  and  com- 
munity, stripped  of  one's  name,  identity,  and  dignity;  of  everything  that 
made  one  a  person  rather  than  a  mere  human  machine  capable  of  un- 
derstanding orders.  Neither  were  most  slaves  offered  much  opportunity 
to  develop  enduring  human  relations.  Most  that  ended  up  in  Caribbean 
or  American  plantations,  though,  were  simply  worked  to  death. 

What  is  remarkable  is  that  all  this  was  done,  the  bodies  extracted, 
through  the  very  mechanisms  of  the  human  economy,  premised  on  the 
principle  that  human  lives  are  the  ultimate  value,  to  which  nothing 
could  possibly  compare.  Instead,  all  the  same  institutions — fees  for  ini- 
tiations, means  of  calculating  guilt  and  compensation,  social  currencies, 
debt  pawnship — were  turned  into  their  opposite;  the  machinery  was,  as 
it  were,  thrown  into  reverse;  and,  as  the  Tiv  also  perceived,  the  gears 
and  mechanisms  designed  for  the  creation  of  human  beings  collapsed 
on  themselves  and  became  the  means  for  their  destruction. 

I  do  not  want  to  leave  the  reader  with  the  impression  that  what  I  am 
describing  here  is  in  any  way  peculiar  to  Africa.  One  could  find  the 
exact  same  things  happening  wherever  human  economies  came  into 
contact  with  commercial  ones  (and  particularly,  commercial  economies 
with  advanced  military  technology  and  an  insatiable  demand  for  hu- 
man labor). 

Remarkably  similar  things  can  be  observed  throughout  Southeast 
Asia,  particularly  amongst  hill  and  island  people  living  on  the  fringes  of 
major  kingdoms.  As  the  premier  historian  of  the  region,  Anthony  Reid, 



has  pointed  out,  labor  throughout  Southeast  Asia  has  long  been  orga- 
nized above  all  through  relations  of  debt  bondage. 

Even  in  relatively  simple  societies  little  penetrated  by  money, 
there  were  ritual  needs  for  substantial  expenditures — the  pay- 
ment of  bride-price  for  marriage  and  the  slaughter  of  a  buffalo 
at  the  death  of  a  family  member.  It  is  widely  reported  that  such 
ritual  needs  are  the  most  common  reason  why  the  poor  become 
indebted  to  the  rich  .  .  .80 

For  instance,  one  practice,  noted  from  Thailand  to  Sulawesi,  is 
for  a  group  of  poor  brothers  to  turn  to  a  rich  sponsor  to  pay  for  the 
expenses  of  one  brother's  marriage.  He's  then  referred  to  as  their  "mas- 
ter." This  is  more  like  a  patron-client  relation  than  anything  else:  the 
brothers  might  be  obliged  to  do  the  occasional  odd  job,  or  appear  as 
his  entourage  on  occasions  when  he  has  to  make  a  good  impression — 
not  much  more.  Still,  technically,  he  owns  their  children,  and  "can  also 
repossess  the  wife  he  provided  if  his  bondsmen  fail  to  carry  out  his 

Elsewhere,  we  hear  similar  stories  to  those  in  Africa — of  peasants 
pawning  themselves  or  members  of  their  families,  or  even  gambling 
themselves  into  bondage;  of  principalities  where  penalties  invariably 
took  the  form  of  heavy  fines.  "Frequently,  of  course,  these  fines  could 
not  be  paid,  and  the  condemned  man,  often  accompanied  by  his  depen- 
dants, became  the  bondsman  of  the  ruler,  of  the  injured  party,  or  of 
whoever  was  able  to  pay  his  fine  for  him."82  Reid  insists  that  most  of 
this  was  relatively  innocuous — in  fact,  poor  men  might  take  out  loans 
for  the  express  purpose  of  becoming  debtors  to  some  wealthy  patron, 
who  could  provide  them  with  food  during  hard  times,  a  roof,  a  wife. 
Clearly  this  was  not  "slavery"  in  the  ordinary  sense.  That  is,  unless 
the  patron  decided  to  ship  some  of  his  dependents  off  to  creditors  of 
his  own  in  some  distant  city  like  Majapahit  or  Ternate,  whereupon 
they  might  find  themselves  toiling  in  some  grandee's  kitchen  or  pepper 
plantation  like  any  other  slave. 

It's  important  to  point  this  out  because  one  of  the  effects  of  the 
slave  trade  is  that  people  who  don't  actually  live  in  Africa  are  often 
left  with  an  image  of  that  continent  as  an  irredeemably  violent,  savage 
place — an  image  that  has  had  disastrous  effects  on  those  who  do  live 
there.  It  might  be  fitting,  then,  to  consider  the  history  of  one  place  that 
is  usually  represented  as  the  polar  opposite:  Bali,  the  famous  "land  of 
ten  thousand  temples" — an  island  often  pictured  in  anthropological 
texts  and  tourist  brochures  as  if  it  were  inhabited  exclusively  by  placid, 



dreamy  artists  who  spend  their  days  arranging  flowers  and  practicing 
synchronized  dance  routines. 

In  the  seventeenth  and  eighteenth  centuries,  Bali  had  not  yet  ob- 
tained this  reputation.  At  the  time,  it  was  still  divided  among  a  dozen 
tiny,  squabbling  kingdoms  in  an  almost  perpetual  state  of  war.  In  fact, 
its  reputation  among  the  Dutch  merchants  and  officials  ensconced  in 
nearby  Java  was  almost  exactly  the  opposite  of  what  it  is  today.  Ba- 
linese  were  considered  a  rude  and  violent  people  ruled  by  decadent, 
opium-addicted  nobles  whose  wealth  was  based  almost  exclusively  on 
their  willingness  to  sell  their  subjects  to  foreigners  as  slaves.  By  the 
time  the  Dutch  were  fully  in  control  in  Java,  Bali  had  been  turned 
largely  into  a  reservoir  for  the  export  of  human  beings — young  Bali- 
nese  women  in  particular  being  in  great  demand  in  cities  through  the 
region  as  both  prostitutes  and  concubines.83  As  the  island  was  drawn 
into  the  slave  trade,  almost  the  entire  social  and  political  system  of  the 
island  was  transformed  into  an  apparatus  for  the  forcible  extraction 
of  women.  Even  within  villages,  ordinary  marriages  took  the  form  of 
"marriage  by  capture" — sometimes  staged  elopements,  sometimes  real 
forcible  kidnappings,  after  which  the  kidnappers  would  pay  a  woman's 
family  to  let  the  matter  drop.84  If  a  woman  was  captured  by  someone 
genuinely  important,  though,  no  compensation  would  be  offered.  Even 
in  the  1960s,  elders  recalled  how  attractive  young  women  used  to  be 
hidden  away  by  their  parents, 

forbidden  to  bear  towering  offerings  to  temple  festivals,  lest 
they  be  espied  by  a  royal  scout  and  hustled  into  the  closely 
protected  female  quarters  of  the  palace,  where  the  eyes  of  male 
visitors  were  restricted  to  foot  level.  For  there  was  slim  chance 
a  girl  would  become  a  legitimate  low-caste  wife  (penawing)  of 
the  raja  .  .  .  More  likely  after  affording  a  few  years'  licentious 
satisfaction,  she  would  degenerate  into  a  slave-like  servant.85 

Or,  if  she  did  rise  to  such  a  position  that  the  high-caste  wives  be- 
gan to  see  her  as  a  rival,  she  might  be  either  poisoned  or  shipped  off 
overseas  to  end  up  servicing  soldiers  at  some  Chinese-run  bordello  in 
Jogjakarta,  or  changing  bedpans  in  the  house  of  a  French  plantation- 
owner  in  the  Indian  Ocean  island  of  Reunion.86  Meanwhile,  royal  law 
codes  were  rewritten  in  all  the  usual  ways,  with  the  exception  that  here, 
the  force  of  law  was  directed  above  all  and  explicitly  against  women. 
Not  only  were  criminals  and  debtors  to  be  enslaved  and  deported,  but 
any  married  man  was  granted  the  power  to  renounce  his  wife,  and  by 
doing  so  render  her,  automatically,  property  of  the  local  ruler,  to  be 



disposed  of  as  he  wished.  Even  a  woman  whose  husband  died  before 
she  had  produced  male  offspring  would  to  be  handed  over  to  the  palace 
to  be  sold  abroad.87 

As  Adrian  Vickers  explains,  even  Bali's  famous  cockfights — so  fa- 
miliar to  any  first-year  anthropology  student — were  originally  promot- 
ed by  royal  courts  as  a  way  of  recruiting  human  merchandise: 

Kings  even  helped  put  people  into  debt  by  staging  large  cock- 
fights in  their  capitals.  The  passion  and  extravagance  encour- 
aged by  this  exciting  sport  led  many  peasants  to  bet  more  than 
they  could  afford.  As  with  any  gambling,  the  hope  of  great 
wealth  and  the  drama  of  a  contest  fuelled  ambitions  which 
few  could  afford  and  at  the  end  of  the  day,  when  the  last  spur 
had  sunk  into  the  chest  of  the  last  rooster,  many  peasants  had 
no  home  and  family  to  return  to.  They,  and  their  wives  and 
children,  would  be  sold  to  Java.88 

Reflections  on  Violence 

I  began  this  book  by  asking  a  question:  How  is  it  that  moral  obliga- 
tions between  people  come  to  be  thought  of  as  debts,  and  as  a  result, 
end  up  justifying  behavior  that  would  otherwise  seem  utterly  immoral? 

I  began  this  chapter  by  beginning  to  propose  an  answer:  by  making 
a  distinction  between  commercial  economies  and  what  I  call  "human 
economies" — that  is,  those  where  money  acts  primarily  as  a  social 
currency,  to  create,  maintain,  or  sever  relations  between  people  rather 
than  to  purchase  things.  As  Rospabe  so  cogently  demonstrated,  it  is 
the  peculiar  quality  of  such  social  currencies  that  they  are  never  quite 
equivalent  to  people.  If  anything,  they  are  a  constant  reminder  that 
human  beings  can  never  be  equivalent  to  anything — even,  ultimately, 
to  one  another.  This  is  the  profound  truth  of  the  blood-feud.  No  one 
can  ever  really  forgive  the  man  who  killed  his  brother  because  every 
brother  is  unique.  Nothing  could  substitute — not  even  some  other  man 
given  the  same  name  and  status  as  your  brother,  or  a  concubine  who 
will  bear  a  son  who  will  be  named  after  your  brother,  or  a  ghost-wife 
who  will  bear  a  child  pledged  to  someday  avenge  his  death. 

In  a  human  economy,  each  person  is  unique,  and  of  incompa- 
rable value,  because  each  is  a  unique  nexus  of  relations  with  others. 
A  woman  may  be  a  daughter,  sister,  lover,  rival,  companion,  mother, 
age-mate,  and  mentor  to  many  different  people  in  different  ways.  Each 
relation  is  unique,  even  in  a  society  in  which  they  are  sustained  through 



the  constant  giving  back  and  forth  of  generic  objects  such  as  raffia 
cloth  or  bundles  of  copper  wire.  In  one  sense,  those  objects  make  one 
who  one  is — a  fact  illustrated  by  the  way  the  objects  used  as  social 
currencies  are  so  often  things  otherwise  used  to  clothe  or  decorate  the 
human  body,  that  help  make  one  who  one  is  in  the  eyes  of  others.  Still, 
just  as  our  clothes  don't  really  make  us  who  we  are,  a  relationship  kept 
alive  by  the  giving  and  taking  of  raffia  is  always  something  more  than 
that.89  This  means  that  the  raffia,  in  turn,  is  always  something  less. 
This  is  why  I  think  Rospabe  was  right  to  emphasize  the  fact  that  in 
such  economies,  money  can  never  substitute  for  a  person:  money  is  a 
way  of  acknowledging  that  very  fact,  that  the  debt  cannot  be  paid.  But 
even  the  notion  that  a  person  can  substitute  for  a  person,  that  one  sis- 
ter can  somehow  be  equated  with  another,  is  by  no  means  self-evident. 
In  this  sense,  the  term  "human  economy"  is  double-edged.  These  are, 
after  all,  economies:  that  is,  systems  of  exchange  in  which  qualities  are 
reduced  to  quantities,  allowing  calculations  of  gain  and  loss — even  if 
those  calculations  are  simply  a  matter  (as  in  sister  exchange)  of  i  equals 
i,  or  (as  in  the  feud)  of  i  minus  i  equals  o. 

How  is  this  calculability  effectuated?  How  does  it  become  pos- 
sible to  treat  people  as  if  they  are  identical?  The  Lele  example  gave 
us  a  hint:  to  make  a  human  being  an  object  of  exchange,  one  woman 
equivalent  to  another  for  example,  requires  first  of  all  ripping  her  from 
her  context;  that  is,  tearing  her  away  from  that  web  of  relations  that 
makes  her  the  unique  conflux  of  relations  that  she  is,  and  thus,  into 
a  generic  value  capable  of  being  added  and  subtracted  and  used  as  a 
means  to  measure  debt.  This  requires  a  certain  violence.  To  make  her 
equivalent  to  a  bar  of  camwood  takes  even  more  violence,  and  it  takes 
an  enormous  amount  of  sustained  and  systematic  violence  to  rip  her  so 
completely  from  her  context  that  she  becomes  a  slave. 

I  should  be  clear  here.  I  am  not  using  the  word  "violence"  meta- 
phorically. I  am  not  speaking  merely  of  conceptual  violence,  but  of  the 
literal  threat  of  broken  bones  and  bruised  flesh;  of  punches  and  kicks; 
in  much  the  same  way  that  when  the  ancient  Hebrews  spoke  of  their 
daughters  in  "bondage,"  they  were  not  being  poetic,  but  talking  about 
literal  ropes  and  chains. 

Most  of  us  don't  like  to  think  much  about  violence.  Those  lucky 
enough  to  live  relatively  comfortable,  secure  lives  in  modern  cities  tend 
either  to  act  as  if  it  does  not  exist  or,  when  reminded  that  it  does,  to 
write  off  the  larger  world  "out  there"  as  a  terrible,  brutal  place,  with 
not  much  that  can  be  done  to  help  it.  Either  instinct  allows  us  not  to 
have  to  think  about  the  degree  to  which  even  our  own  daily  existence 
is  defined  by  violence  or  at  least  the  threat  of  violence  (as  I've  often 



noted,  think  about  what  would  happen  if  you  were  to  insist  on  your 
right  to  enter  a  university  library  without  a  properly  validated  ID),  and 
to  overstate  the  importance — or  at  least  the  frequency — of  things  like 
war,  terrorism,  and  violent  crime.  The  role  of  force  in  providing  the 
framework  for  human  relations  is  simply  more  explicit  in  what  we  call 
"traditional  societies" — even  if  in  many,  actual  physical  assault  by  one 
human  on  another  occurs  less  often  than  in  our  own.  Here's  a  story 
from  the  Bunyoro  kingdom,  in  East  Africa: 

Once  a  man  moved  into  a  new  village.  He  wanted  to  find  out 
what  his  neighbors  were  like,  so  in  the  middle  of  the  night  he 
pretended  to  beat  his  wife  very  severely,  to  see  if  the  neighbors 
would  come  and  remonstrate  with  him.  But  he  did  not  really 
beat  her;  instead  he  beat  a  goatskin,  while  his  wife  screamed 
and  cried  out  that  he  was  killing  her.  Nobody  came,  and  the 
very  next  day  the  man  and  his  wife  packed  up  and  left  that  vil- 
lage and  went  to  find  some  other  place  to  live.90 

The  point  is  obvious.  In  a  proper  village,  the  neighbors  should  have 
rushed  in,  held  him  back,  demanded  to  know  what  the  woman  could 
possibly  have  done  to  deserve  such  treatment.  The  dispute  would  be- 
come a  collective  concern  that  ended  in  some  sort  of  collective  settle- 
ment. This  is  how  people  ought  to  live.  No  reasonable  man  or  woman 
would  want  to  live  in  a  place  where  neighbors  don't  look  after  one 

In  its  own  way  it's  a  revealing  story,  charming  even,  but  one  must 
still  ask:  How  would  a  community — even  one  the  man  in  the  sto- 
ry would  have  considered  a  proper  community — have  reacted  if  they 
thought  she  was  beating  him}91  I  think  we  all  know  the  answer.  The 
first  case  would  have  led  to  concern;  the  second  would  have  led  to  ridi- 
cule. In  Europe  in  the  sixteenth  and  seventeenth  centuries,  young  vil- 
lagers used  to  put  on  satirical  skits  making  fun  of  husbands  beaten  by 
their  wives,  even  to  parade  them  about  the  town  mounted  backwards 
on  an  ass  for  everyone  to  jeer  at.92  No  African  society,  as  far  as  I  know, 
went  quite  this  far.  (Neither  did  any  African  society  burn  as  many 
witches — Western  Europe  at  that  time  was  a  particularly  savage  place.) 
Yet  as  in  most  of  the  world,  the  assumption  that  the  one  sort  of  brutal- 
ity was  at  least  potentially  legitimate,  and  that  the  other  was  not,  was 
the  framework  within  which  relations  between  the  sexes  took  place.93 

What  I  want  to  emphasize  is  that  there  is  a  direct  relation  be- 
tween that  fact  and  the  possibility  of  trading  lives  for  one  another. 



Anthropologists  are  fond  of  making  diagrams  to  represent  preferential 
marriage  patterns.  Sometimes,  these  diagrams  can  be  quite  beautiful:94 

Ideal  pattern  of  bilateral  cross-cousin  marriage 

Sometimes  they  merely  have  a  certain  elegant  simplicity,  as  in  this 
diagram  on  an  instance  of  Tiv  sister  exhange:95 




i — i — 



O  D  AC 


A  B 



A  A 

1  1 

0  M  AN 

1  | 

Human  beings,  left  to  follow  their  own  desires,  rarely  arrange 
themselves  in  symmetrical  patterns.  Such  symmetry  tends  to  be  bought 
at  a  terrible  human  price.  In  the  Tiv  case,  Akiga  is  actually  willing  to 
describe  it: 

Under  the  old  system  an  elder  who  had  a  ward  could  always 
marry  a  young  girl,  however  senile  he  might  be,  even  if  he 



were  a  leper  with  no  hands  or  feet;  no  girl  would  dare  to  re- 
fuse him.  If  another  man  were  attracted  by  his  ward  he  would 
take  his  own  and  give  her  to  the  old  man  by  force,  in  order 
to  make  an  exchange.  The  girl  had  to  go  with  the  old  man, 
sorrowfully  carrying  his  goat-skin  bag.  If  she  ran  back  to  her 
home  her  owner  caught  her  and  beat  her,  then  bound  her  and 
brought  her  back  to  the  elder.  The  old  man  was  pleased,  and 
grinned  till  he  showed  his  blackened  molars.  "Wherever  you 
go,"  he  told  her,  "you  will  be  brought  back  here  to  me;  so 
stop  worrying,  and  settle  down  as  my  wife."  The  girl  fretted, 
till  she  wished  the  earth  might  swallow  her.  Some  women  even 
stabbed  themselves  to  death  when  they  were  given  to  an  old 
man  against  their  will;  but  in  spite  of  all,  the  Tiv  did  not  care.96 

The  last  line  says  everything.  Citing  it  might  seem  unfair  (the  Tiv 
did,  evidently,  care  enough  to  elect  Akiga  to  be  their  first  parliamen- 
tary representative,  knowing  he  supported  legislation  to  outlaw  such 
practices),  but  it  serves  nicely  to  bring  home  the  real  point:  that  certain 
sorts  of  violence  were  considered  morally  acceptable.97  No  neighbors 
would  rush  in  to  intervene  if  a  guardian  was  beating  a  runaway  ward. 
Or  if  they  did,  it  would  be  to  insist  that  he  use  more  gentle  means  to 
return  her  to  her  rightful  husband.  And  it  was  because  women  knew 
that  this  is  how  their  neighbors,  or  even  parents,  would  react  that  "ex- 
change marriage"  was  possible. 

This  is  what  I  mean  by  people  "ripped  from  their  contexts." 

The  Lele  were  fortunate  enough  to  have  largely  escaped  the  devasta- 
tions of  the  slave  trade;  the  Tiv  were  sitting  practically  on  the  teeth 
of  the  shark,  and  they  had  to  make  heroic  efforts  to  keep  the  threat 
at  bay.  Nonetheless,  in  both  cases  there  were  mechanisms  for  forcibly 
removing  young  women  from  their  homes,  and  it  was  precisely  this 
that  made  them  exchangeable — though  in  each  case  too,  a  principle 
stipulated  that  a  woman  could  only  be  exchanged  for  another  woman. 
The  few  exceptions,  when  women  could  be  exchanged  for  other  things, 
emerged  directly  from  war  and  slavery — that  is,  when  the  level  of  vio- 
lence was  significantly  ratcheted  up. 

The  slave  trade,  of  course,  represented  violence  on  an  entirely  dif- 
ferent scale.  We  are  speaking  here  of  destruction  of  genocidal  pro- 
portions, in  world-historic  terms,  comparable  only  to  events  like  the 
destruction  of  New  World  civilizations  or  the  Holocaust.  Neither  do 



I  mean  in  any  way  to  blame  the  victims:  we  need  only  imagine  what 
would  be  likely  to  happen  in  our  own  society  if  a  group  of  space  aliens 
suddenly  appeared,  armed  with  undefeatable  military  technology,  infi- 
nite wealth,  and  no  recognizable  morality — and  announced  that  they 
were  willing  to  pay  a  million  dollars  each  for  human  workers,  no  ques- 
tions asked.  There  will  always  be  at  least  a  handful  of  people  unscru- 
pulous enough  to  take  advantage  of  such  a  situation — and  a  handful 
is  all  it  takes. 

Groups  like  the  Aro  Confederacy  represent  an  all-too-familiar 
strategy,  deployed  by  fascists,  mafias,  and  right-wing  gangsters  every- 
where: first  unleash  the  criminal  violence  of  an  unlimited  market,  in 
which  everything  is  for  sale  and  the  price  of  life  becomes  extremely 
cheap;  then  step  in,  offering  to  restore  a  certain  measure  of  order — 
though  one  which  in  its  very  harshness  leaves  all  the  most  profitable 
aspects  of  the  earlier  chaos  intact.  The  violence  is  preserved  within  the 
structure  of  the  law.  Such  mafias,  too,  almost  invariably  end  up  enforc- 
ing a  strict  code  of  honor  in  which  morality  becomes  above  all  a  matter 
of  paying  one's  debts. 

Were  this  a  different  book,  I  might  reflect  here  on  the  curious  par- 
allels between  the  Cross  River  societies  and  Bali,  both  of  which  saw 
a  magnificent  outburst  of  artistic  creativity  (Cross  River  Ekpe  masks 
were  a  major  influence  on  Picasso)  that  took  the  form,  above  all,  of 
an  efflorescence  of  theatrical  performance,  replete  with  intricate  music, 
splendid  costumes,  and  stylized  dance — a  kind  of  alternative  political 
order  as  imaginary  spectacle — at  the  exact  moment  that  ordinary  life 
became  a  game  of  constant  peril  in  which  any  misstep  might  lead  to 
being  sent  away.  What  was  the  link  between  the  two?  It's  an  interesting 
question,  but  not  one  we  can  really  answer  here.  For  present  purposes, 
the  crucial  question  has  to  be:  How  common  was  this?  The  African 
slave  trade  was,  as  I  mentioned,  an  unprecedented  catastrophe,  but 
commercial  economies  had  already  been  extracting  slaves  from  human 
economies  for  thousands  of  years.  It  is  a  practice  as  old  as  civilization. 
The  question  I  want  to  ask  is:  To  what  degree  is  it  actually  constitutive 
of  civilization  itself? 

I  am  not  speaking  strictly  of  slavery  here,  but  of  that  process  that 
dislodges  people  from  the  webs  of  mutual  commitment,  shared  history, 
and  collective  responsibility  that  make  them  what  they  are,  so  as  to 
make  them  exchangeable — that  is,  to  make  it  possible  to  make  them 
subject  to  the  logic  of  debt.  Slavery  is  just  the  logical  end-point,  the 
most  extreme  form  of  such  disentanglement.  But  for  that  reason  it  pro- 
vides us  with  a  window  on  the  process  as  a  whole.  What's  more,  ow- 
ing to  its  historical  role,  slavery  has  shaped  our  basic  assumptions  and 



institutions  in  ways  that  we  are  no  longer  aware  of  and  whose  influ- 
ence we  would  probably  never  wish  to  acknowledge  if  we  were.  If  we 
have  become  a  debt  society,  it  is  because  the  legacy  of  war,  conquest, 
and  slavery  has  never  completely  gone  away.  It's  still  there,  lodged  in 
our  most  intimate  conceptions  of  honor,  property,  even  freedom.  It's 
just  that  we  can  no  longer  see  that  it's  there. 

In  the  next  chapter,  I  will  begin  to  describe  how  this  happened. 

Chapter  Seven 



urs  [HAR]:  n.,  liver;  spleen;  heart,  soul; 
bulk,  main  body;  foundation;  loan; 
obligation;  interest;  surplus,  profit; 
interest-bearing  debt;  repayment;  slave- 

— early  Sumerian  dictionary1 

It  is  just  to  give  each  what  is  owed. 

— Simonides 

IN  THE  LAST  CHAPTER,  I  offered  a  glimpse  of  how  human  econo- 
mies, with  their  social  currencies — which  are  used  to  measure,  assess, 
and  maintain  relationships  between  people,  and  only  perhaps  inciden- 
tally to  acquire  material  goods — might  be  transformed  into  something 
else.  What  we  discovered  was  that  we  cannot  begin  to  think  about  such 
questions  without  taking  into  account  the  role  of  sheer  physical  vio- 
lence. In  the  case  of  the  African  slave  trade,  this  was  primarily  violence 
imposed  from  outside.  Nonetheless,  its  very  suddenness,  its  very  brutal- 
ity, provides  us  with  a  sort  of  freeze-frame  of  a  process  that  must  have 
occurred  in  a  much  slower,  more  haphazard  fashion  in  other  times  and 
places.  This  is  because  there  is  every  reason  to  believe  that  slavery,  with 
its  unique  ability  to  rip  human  beings  from  their  contexts,  to  turn  them 
into  abstractions,  played  a  key  role  in  the  rise  of  markets  everywhere. 

What  happens,  then,  when  the  same  process  happens  more  slowly? 
It  would  seem  that  much  of  this  history  is  permanently  lost — since  in 
both  the  ancient  Middle  East  and  the  ancient  Mediterranean,  most  of 
the  really  critical  moments  seem  to  have  occurred  just  before  the  ad- 
vent of  written  records.  Still,  the  broad  outlines  can  be  reconstructed. 



The  best  way  to  do  so,  I  believe,  is  to  start  from  a  single,  odd,  vexed 
concept:  the  concept  of  honor,  which  can  be  treated  as  a  kind  of  arti- 
fact, or  even  as  a  hieroglyphic,  a  fragment  preserved  from  history  that 
seems  to  compress  into  itself  the  answer  to  almost  everything  we've 
been  trying  to  understand.  On  the  one  hand,  violence:  men  who  live  by 
violence,  whether  soldiers  or  gangsters,  are  almost  invariably  obsessed 
with  honor,  and  assaults  on  honor  are  considered  the  most  obvious 
justification  for  acts  of  violence.  On  the  other,  debt.  We  speak  both  of 
debts  of  honor,  and  honoring  one's  debts;  in  fact,  the  transition  from 
one  to  the  other  provides  the  best  clue  to  how  debts  emerge  from  obli- 
gations; even  as  the  notion  of  honor  seemed  to  echo  a  defiant  insistence 
that  financial  debts  are  not  really  the  most  important  ones;  an  echo, 
here,  of  arguments  that,  like  those  in  the  Vedas  and  the  Bible,  go  back 
to  the  very  dawn  of  the  market  itself.  Even  more  disturbingly,  since  the 
notion  of  honor  makes  no  sense  without  the  possibility  of  degradation, 
reconstructing  this  history  reveals  how  much  our  basic  concepts  of 
freedom  and  morality  took  shape  within  institutions — notably,  but  not 
only,  slavery — that  we'd  sooner  not  have  to  think  about  at  all. 

To  underscore  some  of  the  paradoxes  surrounding  the  concept  and 
bring  home  what's  really  at  stake  here,  let  us  consider  the  story  of  one 
man  who  survived  the  Middle  Passage:  Olaudah  Equiano,  born  some- 
time around  1745  in  a  rural  community  somewhere  within  the  confines 
of  the  Kingdom  of  Benin.  Kidnapped  from  his  home  at  the  age  of 
eleven,  Equiano  was  eventually  sold  to  British  slavers  operating  in  the 
Bight  of  Biafra,  from  whence  he  was  conveyed  first  to  Barbados,  then 
to  a  plantation  in  colonial  Virginia. 

Equiano's  further  adventures — and  there  were  many — are  narrated 
in  his  autobiography,  The  Interesting  Narrative  of  the  Life  of  Olau- 
dah Equiano:  or,  Gustavus  Vassa,  the  African,  published  in  1789.  After 
spending  much  of  the  Seven  Years'  War  hauling  gunpowder  on  a  Brit- 
ish frigate,  he  was  promised  his  freedom,  denied  his  freedom,  sold  to 
several  owners — who  regularly  lied  to  him,  promising  his  freedom,  and 
then  broke  their  word — until  he  passed  into  the  hands  of  a  Quaker 
merchant  in  Pennsylvania,  who  eventually  allowed  him  to  purchase  his 
freedom.  Over  the  course  of  his  later  years  he  was  to  become  a  success- 
ful merchant  in  his  own  right,  a  best-selling  author,  an  Arctic  explorer, 
and  eventually,  one  of  the  leading  voices  of  English  Abolitionism.  His 
eloquence  and  the  power  of  his  life  story  played  significant  parts  in  the 
movement  that  led  to  the  British  abolition  of  the  slave  trade  in  1807. 



Readers  of  Equiano's  book  are  often  troubled  by  one  aspect  of  the 
story:  that  for  most  of  his  early  life,  he  was  not  opposed  to  the  institu- 
tion of  slavery.  At  one  point,  while  saving  money  to  buy  his  freedom, 
he  even  briefly  took  a  job  that  involved  purchasing  slaves  in  Africa. 
Equiano  only  came  around  to  an  abolitionist  position  after  converting 
to  Methodism  and  falling  in  with  religious  activists  against  the  trade. 
Many  have  asked:  Why  did  it  take  him  so  long?  Surely  if  anyone  had 
reason  to  understand  the  evils  of  slavery,  he  did. 

The  answer  seems,  oddly,  to  lie  in  the  man's  very  integrity.  One 
thing  that  comes  through  strikingly  in  the  book  is  that  this  was  not 
only  a  man  of  endless  resourcefulness  and  determination,  but  above 
all,  a  man  of  honor.  Yet  this  created  a  terrible  dilemma.  To  be  made 
a  slave  is  to  be  stripped  of  any  possible  honor.  Equiano  wished  above 
all  else  to  regain  what  had  been  taken  from  him.  The  problem  is  that 
honor  is,  by  definition,  something  that  exists  in  the  eyes  of  others.  To 
be  able  to  recover  it,  then,  a  slave  must  necessarily  adopt  the  rules  and 
standards  of  the  society  that  surrounds  him,  and  this  means  that,  in 
practice  at  least,  he  cannot  absolutely  reject  the  institutions  that  de- 
prived him  of  his  honor  in  the  first  place. 

It  strikes  me  that  this  experience — of  only  being  able  to  restore 
one's  lost  honor,  to  regain  the  ability  to  act  with  integrity  by  acting 
in  accord  with  the  terms  of  a  system  that  one  knows,  through  deeply 
traumatic  personal  experience,  to  be  utterly  unjust — is  itself  one  of 
the  most  profoundly  violent  aspects  of  slavery.  It  is  another  example, 
perhaps,  of  the  need  to  argue  in  the  master's  language,  but  here  taken 
to  insidious  extremes. 

All  societies  based  on  slavery  tend  to  be  marked  by  this  agonizing 
double  consciousness:  the  awareness  that  the  highest  things  one  has  to 
strive  for  are  also,  ultimately,  wrong;  but  at  the  same  time,  the  feeling 
that  this  is  simply  the  nature  of  reality.  This  might  help  explain  why 
throughout  most  of  history,  when  slaves  did  rebel  against  their  mas- 
ters, they  rarely  rebelled  against  slavery  itself.  But  the  flip  side  of  this  is 
that  even  slave-owners  seemed  to  feel  that  the  whole  arrangement  was 
somehow  fundamentally  perverse  or  unnatural.  First-year  Roman  law 
students,  for  instance,  were  made  to  memorize  the  following  definition: 


is  an  institution  according  to  the  law  of  nations  whereby 
one  person  falls  under  the  property  rights  of  another,  contrary 
to  nature.2 



At  the  very  least,  there  was  always  seen  to  be  something  disrep- 
utable and  ugly  about  slavery.  Anyone  too  close  to  it  was  tainted. 
Slave-traders  particularly  were  scorned  as  inhuman  brutes.  Throughout 
history,  moral  justifications  for  slavery  are  rarely  taken  particularly 
seriously  even  by  those  who  espouse  them.  For  most  of  human  history, 
most  people  saw  slavery  much  as  we  see  war:  a  tawdry  business,  to  be 
sure,  but  one  would  have  to  be  naive  indeed  to  imagine  it  could  simply 
be  eliminated. 

Honor  Is  Surplus  Dignity 

So  what  is  slavery?  I've  already  begun  to  suggest  an  answer  in  the  last 
chapter.  Slavery  is  the  ultimate  form  of  being  ripped  from  one's  con- 
text, and  thus  from  all  the  social  relationships  that  make  one  a  human 
being.  Another  way  to  put  this  is  that  the  slave  is,  in  a  very  real  sense, 

This  was  the  conclusion  of  the  first  scholar  to  carry  out  a  broad 
historical  survey  of  the  institution,  an  Egyptian  sociologist  named  Ali 
'Abd  al-Wahid  Wafi,  in  Paris  in  1931.3  Everywhere,  he  observes,  from 
the  ancient  world  to  then-present-day  South  America,  one  finds  the 
same  list  of  possible  ways  whereby  a  free  person  might  be  reduced  to 

1)  By  the  law  of  force 

a.  By  surrender  or  capture  in  war 

b.  By  being  the  victim  of  raiding  or  kidnapping 

2)  As  legal  punishment  for  crimes  (including  debt) 

3)  Through  paternal  authority  (a  father's  sale  of  his  children) 

4)  Through  the  voluntary  sale  of  one's  self4 

Everywhere,  too,  capture  in  war  is  considered  the  only  way  that 
is  considered  absolutely  legitimate.  All  the  others  were  surrounded 
by  moral  problems.  Kidnapping  was  obviously  criminal,  and  parents 
would  not  sell  children  except  under  desperate  circumstances.5  We  read 
of  famines  in  China  so  severe  that  thousands  of  poor  men  would  cas- 
trate themselves,  in  the  hope  that  they  might  sell  themselves  as  eunuchs 
at  court — but  this  was  also  seen  as  the  sign  of  total  social  breakdown.6 
Even  the  judicial  process  could  easily  be  corrupted,  as  the  ancients  were 
well  aware — especially  when  it  came  to  enslavement  for  debt. 

On  one  level,  al-Wahid's  argument  is  just  an  extended  apologia  for 
the  role  of  slavery  in  Islam — widely  criticized,  since  Islamic  law  never 



eliminated  slavery,  even  when  the  institution  largely  vanished  in  the 
rest  of  the  Medieval  world.  True,  he  argues,  Mohammed  did  not  forbid 
the  practice,  but  still,  the  early  Caliphate  was  the  first  government  we 
know  of  that  actually  succeeded  in  eliminating  all  these  practices  (judi- 
cial abuse,  kidnappings,  the  sale  of  offspring)  that  had  been  recognized 
as  social  problems  for  thousands  of  years,  and  to  limit  slavery  strictly 
to  prisoners  of  war. 

The  book's  most  enduring  contribution,  though,  lay  simply  in  ask- 
ing: What  do  all  these  circumstances  have  in  common?  Al-Wahid's 
answer  is  striking  in  its  simplicity:  one  becomes  a  slave  in  situations 
where  one  would  otherwise  have  died.  This  is  obvious  in  the  case  of 
war:  in  the  ancient  world,  the  victor  was  assumed  to  have  total  power 
over  the  vanquished,  including  their  women  and  children;  all  of  them 
could  be  simply  massacred.  Similarly,  he  argued,  criminals  were  con- 
demned to  slavery  only  for  capital  crimes,  and  those  who  sold  them- 
selves, or  their  children,  normally  faced  starvation.7 

This  is  not  just  to  say,  though,  that  a  slave  was  seen  as  owing  his 
master  his  life  since  he  would  otherwise  be  dead.8  Perhaps  this  was  true 
at  the  moment  of  his  or  her  enslavement.  But  after  that,  a  slave  could 
not  owe  debts,  because  in  almost  every  important  sense,  a  slave  was 
dead.  In  Roman  law,  this  was  quite  explicit.  If  a  Roman  soldier  was 
captured  and  lost  his  liberty,  his  family  was  expected  to  read  his  will 
and  dispose  of  his  possessions.  Should  he  later  regain  his  freedom,  he 
would  have  to  start  over,  even  to  the  point  of  remarrying  the  woman 
who  was  now  considered  his  widow.9 

In  West  Africa,  according  to  one  French  anthropologist,  the  same 
principles  applied: 

Once  he  had  been  finally  removed  from  his  own  milieu  through 
capture  the  slave  was  considered  as  socially  dead,  just  as  if  he 
had  been  vanquished  and  killed  in  combat.  Among  the  Mande, 
at  one  time,  prisoners  of  war  brought  home  by  the  conquerors 
were  offered  dege  (millet  and  milk  porridge) — because  it  was 
held  that  a  man  should  not  die  on  an  empty  stomach — and 
then  presented  with  their  arms  so  that  they  could  kill  them- 
selves. Anyone  who  refused  was  slapped  on  the  face  by  his 
abductor  and  kept  as  a  captive:  he  had  accepted  the  contempt 
which  deprived  him  of  personality.10 

Tiv  horror  stories  about  men  who  are  dead  but  do  not  know  it 
or  who  are  brought  back  from  the  grave  to  serve  their  murderers,  and 



Haitian  zombie  stories,  all  seem  to  play  on  this  essential  horror  of  slav- 
ery: the  fact  that  it's  a  kind  of  living  death. 

In  a  book  called  Slavery  and  Social  Death — surely  the  most  pro- 
found comparative  study  of  the  institution  yet  written — Orlando  Pat- 
terson works  out  exactly  what  it  has  meant  to  be  so  completely  and 
absolutely  ripped  from  one's  context.11  First  of  all,  he  emphasizes,  slav- 
ery is  unlike  any  other  form  of  human  relation  because  it  is  not  a 
moral  relation.  Slave-owners  might  dress  it  up  in  all  sorts  of  legalistic 
or  paternalistic  language,  but  really  this  is  just  window-dressing  and  no 
one  really  believes  it;  really,  it  is  a  relation  based  purely  on  violence; 
a  slave  must  obey  because  if  he  doesn't,  he  can  be  beaten,  tortured,  or 
killed,  and  everyone  is  perfectly  well  aware  of  this.  Second  of  all,  being 
socially  dead  means  that  a  slave  has  no  binding  moral  relations  with 
anyone  else:  he  is  alienated  from  his  ancestors,  community,  family, 
clan,  city;  he  cannot  make  contracts  or  meaningful  promises,  except  at 
the  whim  of  his  master;  even  if  he  acquires  a  family,  it  can  be  broken 
up  at  any  time.  The  relation  of  pure  force  that  attached  him  to  his  mas- 
ter was  hence  the  only  human  relationship  that  ultimately  mattered.  As 
a  result — and  this  is  the  third  essential  element — the  slave's  situation 
was  one  of  utter  degradation.  Hence  the  Mande  warrior's  slap:  the 
captive,  having  refused  his  one  final  chance  to  save  his  honor  by  kill- 
ing himself,  must  recognize  that  he  will  now  be  considered  an  entirely 
contemptible  being.12 

Yet  at  the  same  time,  this  ability  to  strip  others  of  their  dignity 
becomes,  for  the  master,  the  foundation  of  his  honor.  As  Patterson 
notes,  there  have  been  places — the  Islamic  world  affords  numerous 
examples — where  slaves  are  not  even  put  to  work  for  profit;  instead, 
rich  men  make  a  point  of  surrounding  themselves  with  battalions  of 
slave  retainers  simply  for  reasons  of  status,  as  tokens  of  their  magnifi- 
cence and  nothing  else. 

It  seems  to  me  that  this  is  precisely  what  gives  honor  its  notori- 
ously fragile  quality.  Men  of  honor  tend  to  combine  a  sense  of  total 
ease  and  self-assurance,  which  comes  with  the  habit  of  command,  with 
a  notorious  jumpiness,  a  heightened  sensitivity  to  slights  and  insults, 
the  feeling  that  a  man  (and  it  is  almost  always  a  man)  is  somehow 
reduced,  humiliated,  if  any  "debt  of  honor"  is  allowed  to  go  unpaid. 
This  is  because  honor  is  not  the  same  as  dignity.  One  might  even  say: 
honor  is  surplus  dignity.  It  is  that  heightened  consciousness  of  power, 
and  its  dangers,  that  comes  from  having  stripped  away  the  power  and 
dignity  of  others;  or  at  the  very  least,  from  the  knowledge  that  one 
is  capable  of  doing  so.  At  its  simplest,  honor  is  that  excess  dignity 
that  must  be  defended  with  the  knife  or  sword  (violent  men,  as  we 



all  know,  are  almost  invariably  obsessed  with  honor).  Hence  the  war- 
rior's ethos,  where  almost  anything  that  could  possibly  be  seen  as  a 
sign  of  disrespect — in  inappropriate  word,  an  inappropriate  glance — is 
considered  a  challenge,  or  can  be  treated  as  such.  Yet  even  where  overt 
violence  has  largely  been  put  out  of  the  picture,  wherever  honor  is  at 
issue,  it  comes  with  a  sense  that  dignity  can  be  lost,  and  therefore  must 
be  constantly  defended. 

The  result  is  that  to  this  day,  "honor"  has  two  contradictory  mean- 
ings. On  the  one  hand,  we  can  speak  of  honor  as  simple  integrity. 
Decent  people  honor  their  commitments.  This  is  clearly  what  "honor" 
meant  for  Equiano:  to  be  an  honorable  man  meant  to  be  one  who 
speaks  the  truth,  obeys  the  law,  keeps  his  promises,  is  fair  and  con- 
scientious in  his  commercial  dealings.13  His  problem  was  that  honor 
simultaneously  meant  something  else,  which  had  everything  to  do  with 
the  kind  of  violence  required  to  reduce  human  beings  to  commodities 
to  begin  with. 

The  reader  might  be  asking:  But  what  does  all  this  have  to  do  with 
the  origins  of  money?  The  answer  is,  surprisingly:  everything.  Some  of 
the  most  genuinely  archaic  forms  of  money  we  know  about  appear  to 
have  been  used  precisely  as  measures  of  honor  and  degradation:  that  is, 
the  value  of  money  was,  ultimately,  the  value  of  the  power  to  turn  oth- 
ers into  money.  The  curious  puzzle  of  the  cumal — the  slave-girl  money 
of  medieval  Ireland — would  appear  to  be  a  dramatic  illustration. 

Honor  Price  (Early  Medieval  Ireland) 

For  much  of  its  early  history,  Ireland's  situation  was  not  very  different 
than  that  in  many  of  the  African  societies  we  looked  at  in  the  end  of 
the  last  chapter.  It  was  a  human  economy  perched  uncomfortably  on 
the  fringe  of  an  expanding  commercial  one.  What's  more,  at  certain 
periods  there  was  a  very  lively  slave  trade.  As  one  historian  put  it, 
"Ireland  has  no  mineral  wealth,  and  foreign  luxury  goods  could  be 
bought  by  Irish  kings  mainly  for  two  export  goods,  cattle  and  peo- 
ple."14 Hardly  surprising,  perhaps,  that  cattle  and  people  were  the  two 
major  denominations  of  the  currency.  Still,  by  the  time  our  earliest  re- 
cords kick  in,  around  600AD,  the  slave  trade  appears  to  have  died  off, 
and  slavery  itself  was  a  waning  institution,  coming  under  severe  disap- 
proval from  the  Church.15  Why,  then,  were  cumal  still  being  used  as 
units  of  account,  to  tally  up  debts  that  were  actually  paid  out  in  cows, 
and  in  cups  and  brooches  and  other  objects  made  of  silver,  or,  in  the 



case  of  minor  transactions,  sacks  of  wheat  or  oats?  And  there's  an  even 
more  obvious  question:  Why  women'!  There  were  plenty  of  male  slaves 
in  early  Ireland,  yet  no  one  seems  ever  to  have  used  them  as  money. 

Most  of  what  we  know  about  the  economy  of  early  Medieval 
Ireland  comes  from  legal  sources — a  series  of  law  codes,  drawn  up  by 
a  powerful  class  of  jurists,  dating  roughly  from  the  seventh  to  ninth 
centuries  ad.  These,  however,  are  exceptionally  rich.  Ireland  at  that 
time  was  still  very  much  a  human  economy.  It  was  also  a  very  rural 
one:  people  lived  in  scattered  homesteads,  not  unlike  the  Tiv,  growing 
wheat  and  tending  cattle.  The  closest  there  were  to  towns  were  a  few 
concentrations  around  monasteries.  There  appears  to  have  been  a  near 
total  absence  of  markets,  except  for  a  few  on  the  coast — presumably, 
mainly  slave  or  cattle  markets — frequented  by  foreign  ships.16 

As  a  result,  money  was  employed  almost  exclusively  for  social 
purposes:  gifts;  fees  to  craftsmen,  doctors,  poets,  judges,  and  entertain- 
ers; various  feudal  payments  (lords  gave  gifts  of  cattle  to  clients  who 
then  had  to  regularly  supply  them  with  food).  The  authors  of  the  law 
codes  didn't  even  know  how  to  put  a  price  on  most  goods  of  ordinary 
use — pitchers,  pillows,  chisels,  slabs  of  bacon,  and  the  like;  no  one 
seems  ever  to  have  paid  money  for  them.17  Food  was  shared  in  families 
or  delivered  to  feudal  superiors,  who  laid  it  out  in  sumptuous  feasts 
for  friends,  rivals,  and  retainers.  Anyone  needing  a  tool  or  furniture  or 
clothing  either  went  to  a  kinsman  with  the  relevant  craft  skills  or  paid 
someone  to  make  it.  The  objects  themselves  were  not  for  sale.  Kings, 
in  turn,  assigned  tasks  to  different  clans:  this  one  was  to  provide  them 
with  leather,  this  one  poets,  this  one  shields  .  .  .  precisely  the  sort  of  un- 
wieldy arrangement  that  markets  were  later  developed  to  get  around.18 

Money  could  be  loaned.  There  was  a  highly  complex  system  of 
pledges  and  sureties  to  guarantee  that  debtors  delivered  what  they 
owed.  Mainly,  though,  it  was  used  for  paying  fines.  These  fines  are 
endlessly  and  meticulously  elaborated  in  the  codes,  but  what  really 
strikes  the  contemporary  observer  is  that  they  were  carefully  graded  by 
rank.  This  is  true  of  almost  all  the  "Barbarian  Law  Codes" — the  size 
of  the  penalties  usually  has  at  least  as  much  do  with  the  status  of  the 
victim  as  it  does  with  the  nature  of  the  injury — but  only  in  Ireland  were 
things  mapped  out  quite  so  systematically. 

The  key  to  the  system  was  a  notion  of  honor:  literally  "face."19 
One's  honor  was  the  esteem  one  had  in  the  eyes  of  others,  one's  hon- 
esty, integrity,  and  character,  but  also  one's  power,  in  the  sense  of  the 
ability  to  protect  oneself,  and  one's  family  and  followers,  from  any 
sort  of  degradation  or  insult.  Those  who  had  the  highest  degree  of 
honor  were  literally  sacred  beings:  their  persons  and  possessions  were 



sacrosanct.  What  was  so  unusual  about  Celtic  systems — and  the  Irish 
one  went  further  with  this  than  any  other — was  that  honor  could  be 
precisely  quantified.  Every  free  person  had  his  or  her  "honor  price":  the 
price  that  one  had  to  pay  for  an  insult  to  the  person's  dignity.  These 
varied.  The  honor  price  of  a  king,  for  instance,  was  seven  cumal,  or 
seven  slave  girls — this  was  the  standard  honor  price  for  any  sacred  be- 
ing, the  same  as  a  bishop  or  master  poet.  Since  (as  all  sources  hasten  to 
point  out)  slave  girls  were  not  normally  paid  as  such,  this  would  mean, 
in  the  case  of  an  insult  to  such  a  person's  dignity,  one  would  have  to 
pay  twenty-one  milk  cows  or  twenty-one  ounces  of  silver.20  The  honor 
price  of  a  wealthy  peasant  was  two  and  a  half  cows,  of  a  minor  lord, 
that,  plus  half  a  cow  additionally  for  each  of  his  free  dependents — and 
since  a  lord,  to  remain  a  lord,  had  to  have  at  least  five  of  these,  that 
brought  him  up  to  at  least  five  cows  total.21 

Honor  price  is  not  to  be  confused  with  wergeld — the  actual  price 
of  a  man  or  woman's  life.  If  one  killed  a  man,  one  paid  goods  to  the 
value  of  seven  cumals,  in  recompense  for  killing  him,  to  which  one 
then  added  his  honor  price,  for  having  offended  against  his  dignity  (by 
killing  him).  Interestingly,  only  in  the  case  of  a  king  are  the  blood  price 
and  his  honor  price  the  same. 

There  were  also  payments  for  injury:  if  one  wounds  a  man's  cheek, 
one  pays  his  honor  price  plus  the  price  of  the  injury.  (A  blow  to  the 
face  was,  for  obvious  reasons,  particularly  egregious.)  The  problem 
was  how  to  calculate  the  injury,  since  this  varied  according  to  both 
the  physical  damage  and  status  of  the  injured  party.  Here,  Irish  jurists 
developed  the  ingenious  expedient  of  measuring  different  wounds  with 
different  varieties  of  grain:  a  cut  on  the  king's  cheek  was  measured  in 
grains  of  wheat,  on  that  of  a  substantial  farmer  in  oats,  on  that  of  a 
smallholder  merely  in  peas.  One  cow  was  paid  for  each.22  Similarly, 
if  one  stole,  say,  a  man's  brooch  or  pig,  one  had  to  pay  back  three 
brooches  or  three  pigs — plus  his  honor  price,  for  having  violated  the 
sanctity  of  his  homestead.  Attacking  a  peasant  under  the  protection  of 
a  lord  was  the  same  as  raping  a  man's  wife  or  daughter,  a  violation 
of  the  honor  not  of  the  victim,  but  of  the  man  who  should  have  been 
able  to  protect  them. 

Finally,  one  had  to  pay  the  honor  price  if  one  simply  insulted 
someone  of  any  importance:  say,  by  turning  the  person  away  at  a  feast, 
inventing  a  particularly  embarrassing  nickname  (at  least,  if  it  caught 
on),  or  humiliating  the  person  through  the  use  of  satire.23  Mockery 
was  a  refined  art  in  Medieval  Ireland,  and  poets  were  considered  close 
to  magicians:  it  was  said  that  a  talented  satirist  could  rhyme  rats  to 
death,  or  at  the  very  least,  raise  blisters  on  the  faces  of  victims.  Any 



man  publicly  mocked  would  have  no  choice  but  to  defend  his  honor; 
and,  in  Medieval  Ireland,  the  value  of  that  honor  was  precisely  defined. 

I  should  note  that  while  twenty-one  cows  might  not  seem  like 
much  when  we  are  dealing  with  kings,  Ireland  at  the  time  had  about 
150  kings.24  Most  had  only  a  couple  of  thousand  subjects,  though  there 
were  also  higher-ranking,  provincial  kings  for  whom  the  honor  price 
was  double.25  What's  more,  since  the  legal  system  was  completely  sepa- 
rate from  the  political  one,  jurists,  in  theory,  had  the  right  the  demote 
anyone — including  a  king — who  had  committed  a  dishonorable  act.  If 
a  nobleman  turned  a  worthy  man  away  from  his  door  or  feast,  shel- 
tered a  fugitive,  or  ate  steak  from  an  obviously  stolen  cow,  or  even  if 
he  allowed  himself  to  be  satirized  and  did  not  take  the  offending  poet 
to  court,  his  price  could  be  lowered  to  that  of  a  commoner.  But  the 
same  was  true  of  a  king  who  ran  away  in  battle,  or  abused  his  powers, 
or  even  was  caught  working  in  the  fields  or  otherwise  engaging  in  tasks 
beneath  his  dignity.  A  king  who  did  something  utterly  outrageous — 
murdered  one  of  his  own  relatives,  for  example — might  end  up  with  no 
honor  price  at  all,  which  meant  not  that  people  could  say  anything  they 
liked  about  the  king,  without  fear  of  recompense,  but  that  he  couldn't 
stand  as  surety  or  witness  in  court,  as  one's  oath  and  standing  in  law 
was  also  determined  by  one's  honor  price.  This  didn't  happen  often, 
but  it  did  happen,  and  legal  wisdom  made  sure  to  remind  people  of  it: 
the  list,  contained  in  one  famous  legal  text,  of  the  "seven  kings  who 
lost  their  honor  price,"  was  meant  to  ensure  that  everyone  remembered 
that  no  matter  how  sacred  and  powerful,  anyone  could  fall. 

What's  unusual  about  the  Irish  material  is  that  it's  all  spelled  out 
so  clearly.  This  is  partly  because  Irish  law  codes  were  the  work  of  a 
class  of  legal  specialists  who  seem  to  have  turned  the  whole  thing  al- 
most into  a  form  of  entertainment,  devoting  endless  hours  to  coming 
up  with  every  possible  abstract  possibility.  Some  of  the  provisos  are  so 
whimsical  ("if  stung  by  another  man's  bee,  one  must  calculate  the  ex- 
tent of  the  injury,  but  also,  if  one  swatted  it  in  the  process,  subtract  the 
replacement  value  of  the  bee")  that  one  has  to  assume  they  were  simply 
jokes.  Still,  as  a  result,  the  moral  logic  that  lies  behind  any  elaborate 
code  of  honor  is  laid  out  here  in  startling  honesty.  What  about  women? 
A  free  woman  was  honored  at  precisely  50  percent  of  the  price  of  her 
nearest  male  relative  (her  father,  if  alive;  if  not,  her  husband).  If  she 
was  dishonored,  her  price  was  payable  to  that  relative.  Unless,  that 
is,  she  was  an  independent  landholder.  In  that  case,  her  honor  price 
was  the  same  as  that  of  a  man.  And  unless  she  was  a  woman  of  easy 
virtue,  in  which  case  it  was  zero,  since  she  had  no  honor  to  outrage. 
What  about  marriage?  A  suitor  paid  the  value  of  the  wife's  honor  to 



her  father  and  thus  became  its  guardian.  What  about  serfs?  The  same 
principle  applied:  when  a  lord  acquired  a  serf,  he  bought  out  that 
man's  honor  price,  presenting  him  with  its  equivalent  in  cows.  From 
that  moment  on,  if  anyone  insulted  or  injured  the  serf,  it  was  seen  an 
attack  on  the  lord's  honor,  and  it  was  up  to  the  lord  to  collect  the  at- 
tendant fees.  Meanwhile  the  lord's  honor  price  was  notched  upward 
as  a  result  of  gathering  another  dependent:  in  other  words,  he  literally 
absorbs  his  new  vassal's  honor  into  his  own.26 

All  this,  in  turn,  makes  it  possible  to  understand  both  something 
of  the  nature  of  honor,  and  why  slave  girls  were  kept  as  units  for 
reckoning  debts  of  honor  even  at  a  time  when — owing  no  doubt  to 
church  influence — they  no  longer  actually  changed  hands.  At  first  sight 
it  might  seem  strange  that  the  honor  of  a  nobleman  or  king  should  be 
measured  in  slaves,  since  slaves  were  human  beings  whose  honor  was 
zero.  But  if  one's  honor  is  ultimately  founded  on  one's  ability  to  extract 
the  honor  of  others,  it  makes  perfect  sense.  The  value  of  a  slave  is  that 
of  the  honor  that  has  been  extracted  from  them. 

Sometimes,  one  comes  on  a  single  haphazard  detail  that  gives  the 
game  away.  In  this  case  it  comes  not  from  Ireland  but  from  the  Di- 
metian  Code  in  Wales,  written  somewhat  later  but  operating  on  much 
the  same  principles.  At  one  point,  after  listing  the  honors  due  to  the 
seven  holy  sees  of  the  Kingdom  of  Dyfed,  whose  bishops  and  abbots 
were  the  most  exalted  and  sacred  creatures  in  the  kingdom,  the  text 
specifies  that 

Whoever  draws  blood  from  an  abbot  of  any  one  of  those  prin- 
cipal seats  before  mentioned,  let  him  pay  seven  pounds;  and  a 
female  of  his  kindred  to  be  a  washerwoman,  as  a  disgrace  to 
the  kindred,  and  to  serve  as  a  memorial  to  the  payment  of  the 
honor  price.27 

A  washerwoman  was  the  lowest  of  servants,  and  the  one  turned 
over  in  this  case  was  to  serve  for  life.  She  was,  in  effect,  reduced  to 
slavery.  Her  permanent  disgrace  was  the  restoration  of  the  abbot's 
honor.  While  we  cannot  know  if  some  similar  institution  once  lay  be- 
hind the  habit  of  reckoning  the  honor  of  Irish  "sacred"  beings  in  slave- 
women,  the  principle  is  clearly  the  same.  Honor  is  a  zero-sum  game.  A 
man's  ability  to  protect  the  women  of  his  family  is  an  essential  part  of 
that  honor.  Therefore,  forcing  him  to  surrender  a  woman  of  his  family 
to  perform  menial  and  degrading  chores  in  another's  household  is  the 
ultimate  blow  to  his  honor.  This,  in  turn,  makes  it  the  ultimate  reaf- 
firmation of  the  honor  of  he  who  takes  it  away. 



What  makes  Medieval  Irish  laws  seem  so  peculiar  from  our  perspective 
is  that  their  exponents  had  not  the  slightest  discomfort  with  putting 
an  exact  monetary  price  on  human  dignity.  For  us,  the  notion  that  the 
sanctity  of  a  priest  or  the  majesty  of  a  king  could  be  held  equivalent  to 
a  million  fried  eggs  or  a  hundred  thousand  haircuts  is  simply  bizarre. 
These  are  precisely  the  things  that  ought  to  be  considered  beyond  all 
possibility  of  quantification.  If  Medieval  Irish  jurists  felt  otherwise, 
it  was  because  people  at  that  time  did  not  use  money  to  buy  eggs  or 
haircuts.28  It  was  the  fact  that  it  was  still  a  human  economy,  in  which 
money  was  used  for  social  purposes,  that  it  was  possible  to  create  such 
an  intricate  system  whereby  it  was  possible  not  just  to  measure  but  to 
add  and  subtract  specific  quantities  of  human  dignity — and  in  doing  so, 
provide  us  with  a  unique  window  into  the  true  nature  of  honor  itself. 

The  obvious  question  is:  What  happens  to  such  an  economy  when 
people  do  begin  to  use  the  same  money  used  to  measure  dignity  to 
buy  eggs  and  haircuts?  As  the  history  of  ancient  Mesopotamia  and 
the  Mediterranean  world  reveals,  the  result  was  a  profound — and 
enduring — moral  crisis. 

Mesopotamia  (The  Origins  of  Patriarchy) 

In  ancient  Greek,  the  word  for  "honor"  was  time.  In  Homer's  time,  the 
term  appears  to  have  been  used  much  like  the  Irish  term  "honor  price": 
it  referred  both  to  the  glory  of  the  warrior  and  the  compensation  paid 
as  damages  in  case  of  injury  or  insult.  Yet  with  the  rise  of  markets 
over  the  next  several  centuries,  the  meaning  of  the  word  time  began  to 
change.  On  the  one  hand,  it  became  the  word  for  "price" — as  in,  the 
price  of  something  one  buys  in  the  market.  On  the  other,  it  referred  to 
an  attitude  of  complete  contempt  for  markets. 
Actually,  this  is  still  the  case  today: 

In  Greece  the  word  "timi"  means  honor,  which  has  been  typi- 
cally seen  as  the  most  important  value  in  Greek  village  society. 
Honor  is  often  characterized  in  Greece  as  an  open-handed  gen- 
erosity and  blatant  disregard  for  monetary  costs  and  counting. 
And  yet  the  same  word  also  means  "price"  as  in  the  price  of  a 
pound  of  tomatoes.29 



The  word  "crisis"  literally  refers  to  a  crossroads:  it  is  the  point 
where  things  could  go  either  of  two  different  ways.  The  odd  thing 
about  the  crisis  in  the  concept  of  honor  is  that  it  never  seems  to  have 
been  resolved.  Is  honor  the  willingness  to  pay  one's  monetary  debts? 
Or  is  it  the  fact  that  one  does  not  feel  that  monetary  debts  are  really 
that  important?  It  appears  to  be  both  at  the  same  time. 

There's  also  the  question  of  what  men  of  honor  actually  do  think  is 
important.  When  most  of  us  think  of  a  Mediterranean  villager's  sense 
of  honor,  we  don't  think  so  much  of  a  casual  attitude  toward  money 
as  of  a  veritable  obsession  with  premarital  virginity.  Masculine  honor 
is  caught  up  not  even  so  much  in  a  man's  ability  to  protect  his  wom- 
enfolk as  in  his  ability  to  protect  their  sexual  reputations,  to  respond 
to  any  suggestion  of  impropriety  on  the  part  of  his  mother,  wife,  sister, 
or  daughter  as  if  it  were  a  direct  physical  attack  on  his  own  person. 
This  is  a  stereotype,  but  it's  not  entirely  unjustified.  One  historian 
who  went  through  fifty  years  of  police  reports  about  knife-fights  in 
nineteenth-century  Ionia  discovered  that  virtually  every  one  of  them 
began  when  one  party  publicly  suggested  that  the  other's  wife  or  sister 
was  a  whore.'0 

So,  why  the  sudden  obsession  with  sexual  propriety?  It  doesn't 
seem  to  be  there  in  the  Welsh  or  Irish  material.  There,  the  greatest 
humiliation  was  to  see  your  sister  or  daughter  reduced  to  scrubbing 
someone  else's  laundry.  What  is  it,  then,  about  the  rise  of  money  and 
markets  that  cause  so  many  men  to  become  so  uneasy  about  sex?31 

This  is  a  difficult  question,  but  at  the  very  least,  one  can  imagine 
how  the  transition  from  a  human  economy  to  a  commercial  one  might 
cause  certain  moral  dilemmas.  What  happens,  for  instance,  when  the 
same  money  once  used  to  arrange  marriages  and  settle  affairs  of  honor 
can  also  be  used  to  pay  for  the  services  of  prostitutes? 

As  we'll  see,  there  is  reason  to  believe  that  it  is  in  such  moral 
crises  that  we  can  find  the  origin  not  only  of  our  current  conceptions 
of  honor,  but  of  patriarchy  itself.  This  is  true,  at  least,  if  we  define 
"patriarchy"  in  its  more  specific  Biblical  sense:  the  rule  of  fathers,  with 
all  the  familiar  images  of  stern  bearded  men  in  robes,  keeping  a  close 
eye  over  their  sequestered  wives  and  daughters,  even  as  their  children 
kept  a  close  eye  over  their  flocks  and  herds,  familiar  from  the  book 
of  Genesis.'2  Readers  of  the  Bible  had  always  assumed  that  there  was 
something  primordial  in  all  this;  that  this  was  simply  the  way  desert 
people,  and  thus  the  earliest  inhabitants  of  the  Near  East,  had  always 
behaved.  This  was  why  the  translation  of  Sumerian,  in  the  first  half  of 
the  twentieth  century,  came  as  something  of  a  shock. 



In  the  very  earliest  Sumerian  texts,  particularly  those  from  roughly 
3000  to  2500  bc,  women  are  everywhere.  Early  histories  not  only  re- 
cord the  names  of  numerous  female  rulers,  but  make  clear  that  women 
were  well  represented  among  the  ranks  of  doctors,  merchants,  scribes, 
and  public  officials,  and  generally  free  to  take  part  in  all  aspects  of 
public  life.  One  cannot  speak  of  full  gender  equality:  men  still  outnum- 
bered women  in  all  these  areas.  Still,  one  gets  the  sense  of  a  society 
not  so  different  than  that  which  prevails  in  much  of  the  developed 
world  today.  Over  the  course  of  the  next  thousand  years  or  so,  all  this 
changes.  The  place  of  women  in  civic  life  erodes;  gradually,  the  more 
familiar  patriarchal  pattern  takes  shape,  with  its  emphasis  on  chastity 
and  premarital  virginity,  a  weakening  and  eventually  wholesale  disap- 
pearance of  women's  role  in  government  and  the  liberal  professions, 
and  the  loss  of  women's  independent  legal  status,  which  renders  them 
wards  of  their  husbands.  By  the  end  of  the  Bronze  Age,  around  1200  bc, 
we  begin  to  see  large  numbers  of  women  sequestered  away  in  harems 
and  (in  some  places,  at  least),  subjected  to  obligatory  veiling. 

In  fact,  this  appears  to  reflect  a  much  broader  worldwide  pattern. 
It  has  always  been  something  of  a  scandal  for  those  who  like  to  see 
the  advance  of  science  and  technology,  the  accumulation  of  learning, 
economic  growth — "human  progress,"  as  we  like  to  call  it — as  neces- 
sarily leading  to  greater  human  freedom,  that  for  women,  the  exact 
opposite  often  seems  to  be  the  case.  Or  at  least,  has  been  the  case  until 
very  recent  times.  A  similar  gradual  restriction  on  women's  freedoms 
can  be  observed  in  India  and  China.  The  question  is,  obviously,  Why? 
The  standard  explanation  in  the  Sumerian  case  has  been  the  gradual 
infiltration  of  pastoralists  from  the  surrounding  deserts  who,  presum- 
ably, always  had  more  patriarchal  mores.  There  was,  after  all,  only  a 
narrow  strip  of  land  along  the  Tigris  and  Euphrates  rivers  that  could 
support  intensive  irrigation  works,  and  hence,  urban  life.  Civilization 
was  thus  from  early  times  surrounded  by  a  fringe  of  desert  people,  who 
lived  much  like  those  described  in  Genesis  and  spoke  the  same  Semitic 
languages.  It  is  undeniably  true  that,  over  the  course  of  time,  the  Su- 
merian language  was  gradually  replaced — first  by  Akkadian,  then  by 
Amorite,  then  by  Aramaic  languages,  and  finally,  most  recently  of  all, 
by  Arabic,  which  was  also  brought  to  Mesopotamia  and  the  Levant  by 
desert  pastoralists.  While  all  this  did,  clearly,  bring  with  it  profound 
cultural  changes  as  well,  it's  not  a  particularly  satisfying  explanation.33 
Former  nomads  appear  to  have  been  willing  to  adapt  to  urban  life  in 
any  number  of  other  ways.  Why  not  that  one?  And  it's  very  much  a 
local  explanation  and  does  nothing,  really,  to  explain  the  broader  pat- 
tern. Feminist  scholarship  has  instead  tended  to  emphasize  the  growing 



scale  and  social  importance  of  war,  and  the  increasing  centralization 
of  the  state  that  accompanied  it.34  This  is  more  convincing.  Certainly, 
the  more  militaristic  the  state,  the  harsher  its  laws  tended  to  be  toward 
women.  But  I  would  add  another,  complementary  argument.  As  I  have 
emphasized,  historically,  war,  states,  and  markets  all  tend  to  feed  off 
one  another.  Conquest  leads  to  taxes.  Taxes  tend  to  be  ways  to  create 
markets,  which  are  convenient  for  soldiers  and  administrators.  In  the 
specific  case  of  Mesopotamia,  all  of  this  took  on  a  complicated  relation 
to  an  explosion  of  debt  that  threatened  to  turn  all  human  relations — 
and  by  extension,  women's  bodies — into  potential  commodities.  At  the 
same  time,  it  created  a  horrified  reaction  on  the  part  of  the  (male)  win- 
ners of  the  economic  game,  who  over  time  felt  forced  to  go  to  greater 
and  greater  lengths  to  make  clear  that  their  women  could  in  no  sense 
be  bought  or  sold. 

A  glance  at  the  existing  material  on  Mesopotamian  marriage  gives 
us  a  clue  as  to  how  this  might  have  happened. 

It  is  common  anthropological  wisdom  that  bridewealth  tends  to 
be  typical  of  situations  where  population  is  relatively  thin,  land  not  a 
particularly  scarce  resource,  and  therefore,  politics  are  all  about  con- 
trolling labor.  Where  population  is  dense  and  land  at  a  premium,  one 
tends  to  instead  find  dowry:  adding  a  woman  to  the  household  is  add- 
ing another  mouth  to  feed,  and  rather  than  being  paid  off,  a  bride's 
father  is  expected  to  contribute  something  (land,  wealth,  money  .  .  .) 
to  help  support  his  daughter  in  her  new  home.35  In  Sumerian  times,  for 
instance,  the  main  payment  at  marriage  was  a  huge  gift  of  food  paid  by 
the  groom's  father  to  the  bride's,  destined  to  provide  a  sumptuous  feast 
for  the  wedding.36  Before  long,  however,  this  seems  to  have  split  into 
two  payments,  one  for  the  wedding,  another  to  the  woman's  father, 
calculated — and  often  paid — in  silver.37  Wealthy  women  sometimes  ap- 
pear to  have  ended  up  with  the  money:  at  least,  many  appear  to  have 
to  worn  silver  arm  and  leg  rings  of  identical  denominations. 

However  as  time  went  on,  this  payment,  called  the  terhatum,  often 
began  to  take  on  the  qualities  of  a  simple  purchase.  It  was  referred 
to  as  "the  price  of  a  virgin" — not  a  mere  metaphor,  since  the  illegal 
deflowering  of  a  virgin  was  considered  a  property  crime  against  her 
father.38  Marriage  was  referred  to  as  "taking  possession"  of  a  woman, 
the  same  word  one  would  use  for  the  seizure  of  goods.39  In  principle, 
a  wife,  once  possessed,  owed  her  husbands  strict  obedience,  and  often 
could  not  seek  a  divorce  even  in  cases  of  physical  abuse. 

For  women  with  wealthy  or  powerful  parents,  all  this  remained 
largely  a  matter  of  principle,  modified  considerably  in  practice.  Mer- 
chants' daughters,  for  example,  typically  received  substantial  cash 



dowries,  with  which  they  could  go  into  business  in  their  own  right, 
or  act  as  partners  to  their  husbands.  However,  for  the  poor — that  is, 
most  people — marriage  came  more  and  more  to  resemble  a  simple  cash 

Some  of  this  must  have  been  an  effect  of  slavery:  while  actual 
slaves  were  rarely  numerous,  the  very  existence  of  a  class  of  people 
with  no  kin,  who  were  simply  commodities,  did  make  a  difference.  In 
Nuzi,  for  instance,  "the  brideprice  was  paid  in  domestic  animals  and 
silver  amounting  to  a  total  value  of  40  shekels  of  silver'" — to  which  the 
author  drily  adds,  "there  is  some  evidence  that  it  was  equal  to  the  price 
of  a  slave  girl."40  This  must  have  been  making  things  uncomfortably 
obvious.  It's  in  Nuzi,  too,  where  we  happen  to  have  unusually  detailed 
records,  that  we  find  examples  of  rich  men  paying  cut-rate  "brideprice" 
to  impoverished  families  to  acquire  a  daughter  who  they  would  then 
adopt,  but  who  would  in  fact  be  either  kept  as  a  concubine  or  nurse- 
maid, or  married  to  one  of  their  slaves.41 

Still,  the  really  critical  factor  here  was  debt.  As  I  pointed  out  in  the 
last  chapter,  anthropologists  have  long  emphasized  that  paying  bride- 
wealth  is  not  the  same  as  buying  a  wife.  After  all — and  this  was  one 
of  the  clinching  arguments,  remember,  in  the  original  1930s  League  of 
Nations  debate — if  a  man  were  really  buying  a  woman,  wouldn't  he 
also  be  able  to  sell  her?  Clearly  African  and  Melanesian  husbands  were 
not  able  to  sell  their  wives  to  some  third  party.  At  most,  they  could 
send  them  home  and  demand  back  their  bridewealth.42 

A  Mesopotamian  husband  couldn't  sell  his  wife  either.  Or,  nor- 
mally he  couldn't.  Still,  everything  changed  the  moment  he  took  out  a 
loan.  Since  if  he  did,  it  was  perfectly  legal — as  we've  seen — to  use  his 
wife  and  children  as  surety,  and  if  he  was  unable  to  pay,  they  could 
then  be  taken  away  as  debt  pawns  in  exactly  the  same  way  that  he 
could  lose  his  slaves,  sheep,  and  goats.  What  this  also  meant  was  that 
honor  and  credit  became,  effectively,  the  same  thing:  at  least  for  a 
poor  man,  one's  creditworthiness  was  precisely  one's  command  over 
one's  household,  and  (the  flip  side,  as  it  were)  relations  of  domestic 
authority,  relations  that  in  principle  meant  ones  of  care  and  protection, 
became  property  rights  that  could  indeed  be  bought  and  sold. 

Again,  for  the  poor,  this  meant  that  family  members  became  com- 
modities that  could  be  rented  or  sold.  Not  only  could  one  dispose  of 
daughters  as  "brides"  to  work  in  rich  men's  households,  tablets  in  Nuzi 
show  that  one  could  now  hire  out  family  members  simply  by  taking 
out  a  loan:  there  are  recorded  cases  of  men  sending  their  sons  or  even 
wives  as  "pawns"  for  loans  that  were  clearly  just  advance  payment  for 
employment  in  the  lender's  farm  or  cloth  workshop.43 



The  most  dramatic  and  enduring  crisis  centered  on  prostitution. 
It's  actually  not  entirely  clear,  from  the  earliest  sources,  whether  one 
can  speak  here  of  "prostitution"  at  all.  Sumerian  temples  do  often  ap- 
pear to  have  hosted  a  variety  of  sexual  activities.  Some  priestesses,  for 
instance,  were  considered  to  be  married  to  or  otherwise  dedicated  to 
gods.  What  this  meant  in  practice  seems  to  have  varied  considerably. 
Much  as  in  the  case  of  the  later  devadasis,  or  "temple  dancers"  of 
Hindu  India,  some  remained  celibate;  others  were  permitted  to  marry 
but  were  not  to  bear  children;  others  were  apparently  expected  to  find 
wealthy  patrons,  becoming  in  effect  courtesans  to  the  elite.  Still  oth- 
ers lived  in  the  temples  and  had  the  responsibility  to  make  themselves 
sexually  available  to  worshippers  on  certain  ritual  occasions.44  One 
thing  the  early  texts  do  make  clear  is  that  all  such  women  were  con- 
sidered extraordinarily  important.  In  a  very  real  sense,  they  were  the 
ultimate  embodiments  of  civilization.  After  all,  the  entire  machinery  of 
the  Sumerian  economy  ostensibly  existed  to  support  the  temples,  which 
were  considered  the  households  of  the  gods.  As  such,  they  represented 
the  ultimate  possible  refinement  in  everything  from  music  and  dance  to 
art,  cuisine,  and  graciousness  of  living.  Temple  priestesses  and  spouses 
of  the  gods  were  the  highest  human  incarnations  of  this  perfect  life. 

It's  also  important  to  emphasize  that  Sumerian  men  do  not  appear, 
at  least  in  this  earliest  period,  to  have  seen  anything  troubling  about 
the  idea  of  their  sisters  having  sex  for  money.  To  the  contrary,  insofar 
as  prostitution  did  occur  (and  remember,  it  could  not  have  been  nearly 
so  impersonal,  cold-cash  a  relation  in  a  credit  economy),  Sumerian 
religious  texts  identify  it  as  among  the  fundamental  features  of  human 
civilization,  a  gift  given  by  the  gods  at  the  dawn  of  time.  Procreative 
sex  was  considered  natural  (after  all,  animals  did  it).  Non-procreative 
sex,  sex  for  pleasure,  was  divine.45 

The  most  famous  expression  of  this  identification  of  prostitute 
and  civilization  can  be  found  in  the  story  of  Enkidu  in  the  epic  of  Gil- 
gamesh.  In  the  beginning  of  the  story,  Enkidu  is  a  monster — a  naked 
and  ferocious  "wild  man"  who  grazes  with  the  gazelles,  drinks  at  the 
watering  place  with  wild  cattle,  and  terrorizes  the  people  of  the  city. 
Unable  to  defeat  him,  the  citizens  finally  send  out  a  courtesan  who  is 
also  a  priestess  of  the  goddess  Ishtar.  She  strips  before  him,  and  they 
make  love  for  six  days  and  seven  nights.  Afterward,  Enkidu's  former 
animal  companions  run  away  from  him.  After  she  explains  that  he  has 
now  learned  wisdom  and  become  like  a  God  (she  is,  after  all,  a  divine 
consort),  he  agrees  to  put  on  clothing  and  come  to  live  in  the  city  like 
a  proper,  civilized  human  being.46 



Already,  in  the  earliest  version  of  the  Enkidu  story,  though,  one 
can  detect  a  certain  ambivalence.  Much  later,  Enkidu  is  sentenced  to 
death  by  the  gods,  and  his  immediate  reaction  is  to  condemn  the  cour- 
tesan for  having  brought  him  from  the  wilds  in  the  first  place:  he  curses 
her  to  become  a  common  streetwalker  or  tavern  keeper,  living  among 
vomiting  drunks,  abused  and  beaten  by  her  clients.  Then,  later,  he  re- 
grets his  behavior  and  blesses  her  instead.  But  that  trace  of  ambivalence 
was  there  from  the  beginning,  and  over  time,  it  grew  more  powerful. 
From  early  times,  Sumerian  and  Babylonian  temple  complexes  were 
surrounded  by  far  less  glamorous  providers  of  sexual  services — indeed, 
by  the  time  we  know  much  about  them,  they  were  the  center  of  veri- 
table red-light  districts  full  of  taverns  with  dancing  girls,  men  in  drag 
(some  of  them  slaves,  some  runaways),  and  an  almost  infinite  variety  of 
prostitutes.  There  is  an  endlessly  elaborate  terminology  whose  subtle- 
ties are  long  since  lost  to  us.  Most  seem  to  have  doubled  as  entertain- 
ers: tavern-keepers  doubled  as  musicians;  male  transvestites  were  not 
only  singers  and  dancers,  but  often  performed  knife-throwing  acts. 
Many  were  slaves  put  to  work  by  their  masters,  or  women  working 
off  religious  vows  or  debts,  or  debt  bondswomen,  or,  for  that  matter, 
women  escaping  debt  bondage  with  no  place  else  to  go.  Over  time, 
many  of  the  lower-ranking  temple  women  were  either  bought  as  slaves 
or  debt  peons  as  well,  and  there  might  have  often  been  a  blurring  of 
roles  between  priestesses  who  performed  erotic  rituals  and  prostitutes 
owned  by  the  temple  (and  hence,  in  principle,  by  the  god),  sometimes 
lodged  within  the  temple  compound  itself,  whose  earnings  added  to 
the  temple  treasuries.47  Since  most  everyday  transactions  in  Mesopo- 
tamia were  not  cash  transactions,  once  has  to  assume  that  it  was  the 
same  with  prostitutes — like  the  tavern-keepers,  many  of  whom  seem  to 
have  been  former  prostitutes,  they  developed  ongoing  credit  relations 
with  their  clients — and  this  must  have  meant  that  most  were  less  like 
what  we  think  of  as  streetwalkers  and  more  like  courtesans.48  Still, 
the  origins  of  commercial  prostitution  appear  to  have  been  caught  up 
in  a  peculiar  mixture  of  sacred  (or  once-sacred)  practice,  commerce, 
slavery,  and  debt. 

"Patriarchy"  originated,  first  and  foremost,  in  a  rejection  of  the  great 
urban  civilizations  in  the  name  of  a  kind  of  purity,  a  reassertion  of  pa- 
ternal control  against  great  cities  like  Uruk,  Lagash,  and  Babylon,  seen 
as  places  of  bureaucrats,  traders,  and  whores.  The  pastoral  fringes, 
the  deserts  and  steppes  away  from  the  river  valleys,  were  the  places 



to  which  displaced,  indebted  farmers  fled.  Resistance,  in  the  ancient 
Middle  East,  was  always  less  a  politics  of  rebellion  than  a  politics  of 
exodus,  of  melting  away  with  one's  flocks  and  families — often  before 
both  were  taken  away.49  There  were  always  tribal  peoples  living  on  the 
fringes.  During  good  times,  they  began  to  take  to  the  cities;  in  hard 
times,  their  numbers  swelled  with  refugees — farmers  who  effectively 
became  Enkidu  once  again.  Then,  periodically,  they  would  create  their 
own  alliances  and  sweep  back  into  the  cities  once  again  as  conquerors. 
It's  difficult  to  say  precisely  how  they  imagined  their  situation,  because 
it's  only  in  the  Old  Testament,  written  on  the  other  side  of  the  Fertile 
Crescent,  that  one  has  any  record  of  the  pastoral  rebels'  points  of  view. 
But  nothing  there  mitigates  against  the  suggestion  that  the  extraordi- 
nary emphasis  we  find  there  on  the  absolute  authority  of  fathers,  and 
the  jealous  protection  of  their  fickle  womenfolk,  were  made  possible 
by,  but  at  the  same  time  a  protest  against,  this  very  commoditization 
of  people  in  the  cities  that  they  fled. 

The  world's  Holy  Books — the  Old  and  New  Testaments,  the  Ko- 
ran, religious  literature  from  the  Middle  Ages  to  this  day — echo  this 
voice  of  rebellion,  combining  contempt  for  the  corrupt  urban  life,  sus- 
picion of  the  merchant,  and  often,  intense  misogyny.  One  need  only 
think  of  the  image  of  Babylon  itself,  which  has  become  permanently 
lodged  in  the  collective  imagination  as  not  only  the  cradle  of  civiliza- 
tion, but  also  the  Place  of  Whores.  Herodotus  echoed  popular  Greek 
fantasies  when  he  claimed  that  every  Babylonian  maiden  was  obliged 
to  prostitute  herself  at  the  temple,  so  as  to  raise  the  money  for  her 
dowry.50  In  the  New  Testament,  Saint  Peter  often  referred  to  Rome 
as  "Babylon,"  and  the  Book  of  Revelation  provides  perhaps  the  most 
vivid  image  of  what  he  meant  by  this  when  it  speaks  of  Babylon,  "the 
great  whore,"  sitting  "upon  a  scarlet  colored  beast,  full  of  names  of 

17:4  And  the  woman  was  arrayed  in  purple  and  scarlet  color, 
and  decked  with  gold  and  precious  stones  and  pearls,  having  a 
golden  cup  in  her  hand  full  of  abominations  and  filthiness  of 
her  fornication: 

17:5  And  upon  her  forehead  was  a  name  written,  mystery, 


Such  is  the  voice  of  patriarchal  hatred  of  the  city,  and  of  the  angry 
millennial  voices  of  the  fathers  of  the  ancient  poor. 



Patriarchy  as  we  know  it  seems  to  have  taken  shape  in  a  see-sawing 
battle  between  the  newfound  elites  and  newly  dispossessed.  Much  of 
my  own  analysis  here  is  inspired  by  the  brilliant  work  of  feminist  his- 
torian Gerda  Lerner,  who,  in  an  essay  on  the  origins  of  prostitution, 

Another  source  for  commercial  prostitution  was  the  pauper- 
ization of  farmers  and  their  increasing  dependence  on  loans 
in  order  to  survive  periods  of  famine,  which  led  to  debt  slav- 
ery. Children  of  both  sexes  were  given  up  for  debt  pledges  or 
sold  for  "adoption."  Out  of  such  practices,  the  prostitution  of 
female  family  members  for  the  benefit  of  the  head  of  the  fam- 
ily could  readily  develop.  Women  might  end  up  as  prostitutes 
because  their  parents  had  to  sell  them  into  slavery  or  because 
their  impoverished  husbands  might  so  use  them.  Or  they  might 
become  self-employed  as  a  last  alternative  to  enslavement. 
With  luck,  they  might  in  this  profession  be  upwardly  mobile 
through  becoming  concubines. 

By  the  middle  of  the  second  millennium  B.C.,  prostitution 
was  well  established  as  a  likely  occupation  for  the  daughters  of 
the  poor.  As  the  sexual  regulation  of  women  of  the  propertied 
class  became  more  firmly  entrenched,  the  virginity  of  respect- 
able daughters  became  a  financial  asset  for  the  family.  Thus, 
commercial  prostitution  came  to  be  seen  as  a  social  necessity 
for  meeting  the  sexual  needs  of  men.  What  remained  problem- 
atic was  how  to  distinguish  clearly  and  permanently  between 
respectable  and  non-respectable  women. 

This  last  point  is  crucial.  The  most  dramatic  known  attempt  to 
solve  the  problem,  Lerner  observes,  can  be  found  in  a  Middle  Assyrian 
law  code  dating  from  somewhere  between  1400  and  1100  BC,  which  is 
also  the  first  known  reference  to  veiling  in  the  history  of  the  Middle 
East — and  also,  Lerner  emphasizes,  first  to  make  the  policing  of  social 
boundaries  the  responsibility  of  the  state.52  It  is  not  surprising  that  this 
takes  place  under  the  authority  of  perhaps  the  most  notoriously  milita- 
ristic state  in  the  entire  ancient  Middle  East. 

The  code  carefully  distinguishes  among  five  classes  of  women.  Re- 
spectable women  (either  married  ladies  or  concubines),  widows,  and 
daughters  of  free  Assyrian  men — "must  veil  themselves"  when  they  go 
out  on  the  street.  Prostitutes  and  slaves  (and  prostitutes  are  now  con- 
sidered to  include  unmarried  temple  servants  as  well  as  simple  harlots) 
are  not  allowed  to  wear  veils.  The  remarkable  thing  about  the  laws  is 



that  the  punishments  specified  in  the  code  are  not  directed  at  respect- 
able women  who  do  not  wear  veils,  but  against  prostitutes  and  slaves 
who  do.  The  prostitute  was  to  be  publicly  beaten  fifty  times  with  staves 
and  have  pitch  poured  on  her  head;  the  slave  girl  was  to  have  her  ears 
cut  off.  Free  men  proven  to  have  knowingly  abetted  an  impostor  would 
also  be  thrashed  and  put  to  a  month's  forced  labor. 

Presumably  in  the  case  of  respectable  women,  the  law  was  assumed 
to  be  self-enforcing:  as  what  respectable  woman  would  wish  to  go  out 
on  the  street  in  the  guise  of  a  prostitute? 

When  we  refer  to  "respectable"  women,  then,  we  are  referring  to 
those  whose  bodies  could  not,  under  any  conditions,  be  bought  or  sold. 
Their  physical  persons  were  hidden  away  and  permanently  relegated 
to  some  man's  domestic  sphere;  when  they  appeared  in  public  veiled, 
they  were  effectively  still  ostentatiously  walking  around,  even  in  public, 
inside  such  a  sphere.53  Women  who  could  be  exchanged  for  money,  on 
the  other  hand,  must  be  instantly  recognizable  as  such. 

The  Assyrian  law  code  is  one  isolated  instance;  veils  certainly  did 
not  become  obligatory  everywhere  after  1300  bc.  But  it  provides  a  win- 
dow on  developments  that  were  happening,  however  unevenly,  even 
spasmodically,  across  the  region,  propelled  by  the  intersection  of  com- 
merce, class,  defiant  assertions  of  male  honor,  and  the  constant  threat 
of  the  defection  of  the  poor.  States  seem  to  have  played  a  complex  dual 
role,  simultaneously  fostering  commoditization  and  intervening  to  ame- 
liorate its  effects:  enforcing  the  laws  of  debt  and  rights  of  fathers,  and 
offering  periodic  amnesties.  But  the  dynamic  also  led,  over  the  course 
of  millennia,  to  a  systematic  demotion  of  sexuality  itself  from  a  divine 
gift  and  embodiment  of  civilized  refinement  to  one  of  its  more  familiar 
associations:  with  degradation,  corruption,  and  guilt. 

Here  I  think  we  have  the  explanation  for  that  general  decline  of  wom- 
en's freedoms  that  may  be  observed  in  all  the  great  urban  civilizations 
for  so  much  of  their  history.  In  all  of  them,  similar  things  were  hap- 
pening, even  if  in  each  case,  the  pieces  came  together  in  different  ways. 

The  history  of  China,  for  instance,  saw  continual  and  largely  un- 
successful government  campaigns  to  eradicate  both  brideprice  and  debt 
slavery,  and  periodic  scandals  over  the  existence  of  "markets  in  daugh- 
ters," including  the  outright  sale  of  girls  as  daughters,  wives,  concu- 
bines, or  prostitutes  (at  the  buyer's  discretion)  continue  to  this  day.54 
In  India,  the  caste  system  allowed  what  were  otherwise  differences 
between  rich  and  poor  to  be  made  formal  and  explicit.  Brahmins  and 



other  members  of  the  upper  castes  jealously  sequestered  their  daugh- 
ters, and  married  them  off  with  lavish  dowries,  while  the  lower  castes 
practiced  brideprice,  allowing  members  of  the  higher  ("twice-born") 
castes  to  scoff  at  them  for  selling  their  daughters.  The  twice-born  were 
likewise  largely  protected  from  falling  into  debt  bondage,  while  for 
much  of  the  rural  poor,  debt  dependency  was  institutionalized,  with 
the  daughters  of  poor  debtors,  predictably,  often  dispatched  to  brothels 
or  to  the  kitchens  or  laundries  of  the  rich.55  In  either  case,  between  the 
push  of  commoditization,  which  fell  disproportionally  on  daughters, 
and  the  pull  of  those  trying  to  reassert  patriarchal  rights  to  "pro- 
tect" women  from  any  suggestion  that  they  might  be  commoditized, 
women's  formal  and  practical  freedoms  appear  to  have  been  gradually 
but  increasingly  restricted  and  effaced.  As  a  result,  notions  of  honor 
changed  too,  becoming  a  kind  of  protest  against  the  implications  of  the 
market,  even  as  at  the  same  time  (like  the  world  religions)  they  came 
to  echo  that  market  logic  in  endless  subtle  ways. 

Nowhere,  however,  are  our  sources  as  rich  and  detailed  as  they 
are  for  ancient  Greece.  This  is  partly  because  a  commercial  economy 
arrived  there  so  late,  almost  three  thousand  years  later  than  in  Sumer. 
As  a  result,  Classical  Greek  literature  gives  us  a  unique  opportunity  to 
observe  the  transformation  as  it  was  actually  taking  place. 

Ancient  Greece  (Honor  and  Debt) 

The  world  of  the  Homeric  epics  is  one  dominated  by  heroic  warriors 
who  are  disdainful  of  trade.  In  many  ways,  it  is  strikingly  reminiscent 
of  medieval  Ireland.  Money  existed,  but  it  was  not  used  to  buy  any- 
thing; important  men  lived  their  lives  in  pursuit  of  honor,  which  took 
material  form  in  followers  and  treasure.  Treasures  were  given  as  gifts, 
awarded  as  prizes,  carried  off  as  loot.56  This  is  no  doubt  how  time  first 
came  to  mean  both  "honor"  and  "price" — in  such  a  world,  no  one 
sensed  any  sort  of  contradiction  between  the  two.57 

All  this  was  to  change  dramatically  when  commercial  markets  be- 
gan to  develop  two  hundred  years  later.  Greek  coinage  seem  to  have 
been  first  used  mainly  to  pay  soldiers,  as  well  as  to  pay  fines  and  fees 
and  payments  made  to  and  by  the  government,  but  by  about  600  BC, 
just  about  every  Greek  city-state  was  producing  its  own  coins  as  a 
mark  of  civic  independence.  It  did  not  take  long,  though,  before  coins 
were  in  common  use  in  everyday  transactions.  By  the  fifth  century,  in 



Greek  cities,  the  agora,  the  place  of  public  debate  and  communal  as- 
sembly, also  doubled  as  a  marketplace. 

One  of  the  first  effects  of  the  arrival  of  a  commercial  economy  was 
a  series  of  debt  crises,  of  the  sort  long  familiar  from  Mesopotamia  and 
Israel.  "The  poor,"  as  Aristotle  succinctly  put  it  in  his  Constitution  of 
the  Athenians,  "together  with  their  wives  and  children,  were  enslaved 
to  the  rich."58  Revolutionary  factions  emerged,  demanding  amnesties, 
and  most  Greek  cities  were  at  least  for  a  while  taken  over  by  populist 
strongmen  swept  into  power  partly  by  the  demand  for  radical  debt 
relief.  The  solution  most  cities  ultimately  found,  however,  was  quite 
different  than  it  had  been  in  the  Near  East.  Rather  than  institutionalize 
periodic  amnesties,  Greek  cities  tended  to  adopt  legislation  limiting  or 
abolishing  debt  peonage  altogether,  and  then,  to  forestall  future  crises, 
they  would  turn  to  a  policy  of  expansion,  shipping  off  the  children  of 
the  poor  to  found  military  colonies  overseas.  Before  long,  the  entire 
coast  from  Crimea  to  Marseille  was  dotted  with  Greek  cities,  which 
served,  in  turn,  as  conduits  for  a  lively  trade  in  slaves.59  The  sudden 
abundance  of  chattel  slaves,  in  turn,  completely  transformed  the  nature 
of  Greek  society.  First  and  most  famously,  it  allowed  even  citizens  of 
modest  means  to  take  part  in  the  political  and  cultural  life  of  the  city 
and  have  a  genuine  sense  of  citizenship.  But  this,  in  turn,  drove  the 
old  aristocratic  classes  to  develop  more  and  more  elaborate  means  of 
setting  themselves  off  from  what  they  considered  the  tawdriness  and 
moral  corruption  of  the  new  democratic  state. 

When  the  curtain  truly  goes  up  on  Greece,  in  the  fifth  century,  we 
find  everybody  arguing  about  money.  For  the  aristocrats,  who  wrote 
most  of  the  surviving  texts,  money  was  the  embodiment  of  corruption. 
Aristocrats  disdained  the  market.  Ideally,  a  man  of  honor  should  be 
able  to  raise  everything  he  needed  on  his  own  estates,  and  never  have 
to  handle  cash  at  all.60  In  practice,  they  knew  this  was  impossible. 
Yet  at  every  point  they  tried  to  set  themselves  apart  from  the  values 
of  the  ordinary  denizens  of  the  marketplace:  to  contrast  the  beautiful 
gold  and  silver  beakers  and  tripods  they  gave  one  another  at  funerals 
and  weddings  with  the  vulgar  hawking  of  sausages  or  charcoal;  the 
dignity  of  the  athletic  contests  for  which  they  endlessly  trained  with 
commoners'  vulgar  gambling;  the  sophisticated  and  literate  courtesans 
who  attended  to  them  at  their  drinking  clubs,  and  common  prostitutes 
(pome) — slave-girls  housed  in  brothels  near  the  agora,  brothels  often 
sponsored  by  the  democratic  polis  itself  as  a  service  to  the  sexual  needs 
of  its  male  citizenry.  In  each  case,  they  placed  a  world  of  gifts,  generos- 
ity, and  honor  above  sordid  commercial  exchange.61 



This  resulted  in  a  slightly  different  play  of  push  and  pull  than  we 
saw  in  Mesopotamia.  On  the  one  hand,  we  see  a  culture  of  aristocratic 
protest  against  what  they  saw  as  the  lowly  commercial  sensibilities  of 
ordinary  citizens.  On  the  other  hand,  we  see  an  almost  schizophrenic 
reaction  on  the  part  of  the  ordinary  citizens  themselves,  who  simulta- 
neously tried  to  limit  or  even  ban  aspects  of  aristocratic  culture  and  to 
imitate  aristocratic  sensibilities.  Pederasty  is  an  excellent  case  in  point 
here.  On  the  one  hand,  man-boy  love  was  seen  as  the  quintessential 
aristocratic  practice — it  was  the  way,  in  fact,  that  young  aristocrats 
would  ordinarily  become  initiated  into  the  privileges  of  high  society.  As 
a  result,  the  democratic  polis  saw  it  as  politically  subversive  and  made 
sexual  relations  between  male  citizens  illegal.  At  the  same  time,  almost 
everyone  began  to  practice  it. 

The  famous  Greek  obsession  with  male  honor  that  still  informs  so 
much  of  the  texture  of  daily  life  in  rural  communities  in  Greece  hear- 
kens back  not  so  much  to  Homeric  honor  but  to  this  aristocratic  rebel- 
lion against  the  values  of  the  marketplace,  which  everyone,  eventually, 
began  to  make  their  own.62  The  effects  on  women,  though,  were  even 
more  severe  than  they  had  been  in  the  Middle  East.  Already  by  the 
age  of  Socrates,  while  a  man's  honor  was  increasingly  tied  to  disdain 
for  commerce  and  assertiveness  in  public  life,  a  woman's  honor  had 
come  to  be  defined  in  almost  exclusively  sexual  terms:  as  a  matter  of 
virginity,  modesty,  and  chastity,  to  the  extent  that  respectable  women 
were  expected  to  be  shut  up  inside  the  household  and  any  woman  who 
played  a  part  in  public  life  was  considered  for  that  reason  a  prostitute, 
or  tantamount  to  one.63  The  Assyrian  habit  of  veiling  was  not  widely 
adopted  in  the  Middle  East,  but  it  was  adopted  in  Greece.  As  much 
as  it  flies  in  the  face  of  our  stereotypes  about  the  origins  of  "Western" 
freedoms,  women  in  democratic  Athens,  unlike  those  of  Persia  or  Syria, 
were  expected  to  wear  veils  when  they  ventured  out  in  public.64 

Money,  then,  had  passed  from  a  measure  of  honor  to  a  measure  of 
everything  that  honor  was  not.  To  suggest  that  a  man's  honor  could 
be  bought  with  money  became  a  terrible  insult — this  despite  the  fact 
that,  since  men  were  often  taken  in  war  or  even  by  bandits  or  pirates 
and  held  for  ransom,  they  often  did  go  through  dramas  of  bondage 
and  redemption  not  unlike  those  experienced  by  so  many  Middle  East- 
ern women.  One  particularly  striking  way  of  hammering  it  home — 
actually,  in  this  case,  almost  literally — was  by  branding  ransomed  pris- 
oners with  the  mark  of  their  own  currency,  much  as  if  today  some 



imaginary  foreign  kidnapper,  after  having  received  the  ransom  money 
for  an  American  victim,  made  a  point  of  burning  a  dollar  sign  onto  the 
victim's  forehead  before  returning  him.65 

One  question  that  isn't  clear  from  all  this  is,  Why?  Why  had  mon- 
ey, in  particular,  become  such  a  symbol  of  degradation?  Was  it  all 
because  of  slavery?  One  might  be  tempted  to  conclude  that  it  was:  per- 
haps the  newfound  presence  of  thousands  of  utterly  degraded  human 
beings  in  ancient  Greek  cities  made  any  suggestion  that  a  free  man  (let 
alone  a  free  woman)  might  in  any  sense  be  bought  or  sold  particularly 
insulting.  But  this  is  clearly  not  the  case.  Our  discussion  of  the  slave 
money  of  Ireland  showed  that  the  possibility  of  the  utter  degradation 
of  a  human  being  was  in  no  sense  a  threat  to  heroic  honor — in  a  way, 
it  was  its  very  essence.  Homeric  Greeks  do  not  appear  to  have  been 
any  different.  It  seems  hardly  coincidental  that  the  quarrel  between 
Agamemnon  and  Achilles  that  sets  off  the  action  of  the  Iliad,  generally 
considered  to  be  the  first  great  work  of  Western  literature,  is  a  dispute 
over  honor  between  two  heroic  warriors  over  the  disposition  of  a  slave 
girl.66  Agamemnon  and  Achilles  were  also  well  aware  that  it  would 
only  take  an  unfortunate  turn  in  battle,  or  perhaps  a  shipwreck,  for 
either  of  them  to  wind  up  as  a  slave.  Odysseus  barely  escapes  being 
enslaved  on  several  occasions  in  the  Odyssey.  Even  in  the  third  century 
ad,  the  Roman  emperor  Valerian  (253-260  ad),  defeated  at  the  Battle  of 
Edessa,  was  captured  and  spent  the  last  years  of  his  life  as  the  footstool 
that  the  Sassanian  emperor  Shapur  I  used  to  mount  his  horse.  Such 
were  the  perils  of  war.  All  this  was  essential  to  the  nature  of  martial 
honor.  A  warrior's  honor  is  his  willingness  to  play  a  game  on  which 
he  stakes  everything.  His  grandeur  is  directly  proportional  to  how  far 
he  can  fall. 

Was  it,  then,  that  the  advent  of  commercial  money  threw  tradition- 
al social  hierarchies  into  disarray?  Greek  aristocrats  often  spoke  this 
way,  but  the  complaints  seem  rather  disingenuous.  Surely  it  was  money 
that  allowed  such  a  polished  aristocracy  to  exist  in  the  first  place.67 
Rather,  the  thing  that  really  seemed  to  bother  them  about  money  was 
simply  that  they  wanted  it  so  much.  Since  money  could  be  used  to  buy 
just  about  anything,  everybody  wanted  it.  That  is:  it  was  desirable 
because  it  was  non-discriminating.  One  could  see  how  the  metaphor 
of  the  pome  might  seem  particularly  appropriate.  A  woman  "common 
to  the  people" — as  the  poet  Archilochos  put  it — is  available  to  every- 
one. In  principle,  we  shouldn't  be  attracted  to  such  an  undiscriminat- 
ing  creature.  In  fact,  of  course,  we  are.68  And  nothing  was  both  so 
undiscriminating,  and  so  desirable,  as  money.  True,  Greek  aristocrats 
would  ordinarily  insist  that  they  were  not  attracted  to  common  pome, 



and  that  the  courtesans,  flute-girls,  acrobats,  and  beautiful  boys  that 
frequented  their  symposia  were  not  really  prostitutes  at  all  (though  at 
times  they  also  admitted  that  they  really  were),  they  also  struggled  with 
the  fact  that  their  own  high-minded  pursuits,  such  as  chariot-racing, 
outfitting  ships  for  the  navy,  and  sponsoring  tragic  dramas,  required 
the  exact  same  coins  as  the  ones  used  to  buy  cheap  perfume  and  pies 
for  a  fisherman's  wife — the  only  real  difference  being  that  their  pursuits 
tended  to  require  a  lot  more  of  them.6' 

We  might  say,  then,  that  money  introduced  a  democratization  of 
desire.  Insofar  as  everyone  wanted  money,  everyone,  high  and  low,  was 
pursuing  the  same  promiscuous  substance.  But  even  more:  increasingly, 
they  did  not  just  want  money.  They  needed  it.  This  was  a  profound 
change.  In  the  Homeric  world,  as  in  most  human  economies,  we  hear 
almost  no  discussion  of  those  things  considered  necessary  to  human  life 
(food,  shelter,  clothing)  because  it  is  simply  assumed  that  everybody 
has  them.  A  man  with  no  possessions  could,  at  the  very  least,  become  a 
retainer  in  some  rich  man's  household.  Even  slaves  had  enough  to  eat.70 
Here  too,  the  prostitute  was  a  potent  symbol  for  what  had  changed, 
since  while  some  of  the  denizens  of  brothels  were  slaves,  others  were 
simply  poor;  the  fact  that  their  basic  needs  could  no  longer  be  taken 
for  granted  were  precisely  what  made  them  submit  to  others'  desires. 
This  extreme  fear  of  dependency  on  others'  whims  lies  at  the  basis  of 
the  Greek  obsession  with  the  self-sufficient  household. 

All  this  lies  behind  the  unusually  assiduous  efforts  of  the  male 
citizens  of  Greek  city-states — like  the  later  Romans — to  insulate  their 
wives  and  daughters  from  both  the  dangers  and  the  freedoms  of  the 
marketplace.  Unlike  their  equivalents  in  the  Middle  East,  they  do  not 
seem  to  have  offered  them  as  debt  pawns.  Neither,  at  least  in  Ath- 
ens, was  it  legal  for  the  daughters  of  free  citizens  to  be  employed  as 
prostitutes.71  As  a  result,  respectable  women  became  invisible,  largely 
removed  from  the  high  dramas  of  economic  and  political  life.72  If  any- 
one was  enslaved  for  debt,  it  was  normally  the  debtor.  Even  more 
dramatically,  it  was  ordinarily  male  citizens  who  accused  one  another 
of  prostitution — with  Athenian  politicians  regularly  asserting  that  their 
rivals,  when  they  were  young  boys  being  plied  with  gifts  from  their 
male  suitors,  were  really  trading  sex  for  money,  and  hence  deserved  to 
lose  their  civic  freedoms.73 

It  might  be  helpful  here,  to  return  to  the  principles  laid  out  in  chap- 
ter five.  What  we  see  above  all  is  the  erosion  both  of  older  forms  of 



hierarchy — the  Homeric  world  of  great  men  with  their  retainers — and, 
at  the  same  time,  of  older  forms  of  mutual  aid,  with  communistic  rela- 
tions increasingly  being  confined  to  the  interior  of  the  household. 

It's  the  former — the  erosion  of  hierarchy — that  really  seems  to 
have  been  at  stake  in  the  "debt  crises"  that  struck  so  many  Greek  cities 
around  600  bc,  right  around  the  time  that  commercial  markets  were 
first  taking  shape.74  When  Aristotle  spoke  of  the  Athenian  poor  as  fall- 
ing slave  to  the  rich,  what  he  appears  to  have  meant  was  that  in  harsh 
years,  many  poor  farmers  fell  into  debt;  as  a  result  they  ended  up  as 
sharecroppers  on  their  own  property,  dependents.  Some  were  even  sold 
abroad  as  slaves.  This  led  to  unrest  and  agitation,  and  also  to  demands 
for  clean  slates,  for  the  freeing  of  those  held  in  bondage,  and  for  the 
redistribution  of  agricultural  land.  In  a  few  cases  it  led  to  outright 
revolution.  In  Megara,  we  are  told,  a  radical  faction  that  seized  power 
not  only  made  interest-bearing  loans  illegal,  but  did  so  retroactively, 
forcing  creditors  to  make  restitution  of  all  interest  they  had  collected 
in  the  past.75  In  other  cities,  populist  tyrants  seized  power  on  promises 
to  abrogate  agricultural  debts. 

On  the  face  of  it,  all  this  doesn't  seem  all  that  surprising:  the  mo- 
ment when  commercial  markets  developed,  Greek  cities  quickly  devel- 
oped all  the  social  problems  that  had  been  plaguing  Middle  Eastern 
cities  for  millennia:  debt  crises,  debt  resistance,  political  unrest.  In  real- 
ity, things  are  not  so  clear.  For  one  thing,  for  the  poor  to  be  "enslaved 
to  the  rich,"  in  the  loose  sense  that  Aristotle  seems  to  be  using,  was 
hardly  a  new  development.  Even  in  Homeric  society,  it  was  assumed 
as  a  matter  of  course  that  rich  men  would  live  surrounded  by  depen- 
dents and  retainers,  drawn  from  the  ranks  of  the  dependent  poor.  The 
critical  thing,  though,  about  such  relations  of  patronage  is  that  they 
involved  responsibilities  on  both  sides.  A  noble  warrior  and  his  humble 
client  were  assumed  to  be  fundamentally  different  sorts  of  people,  but 
both  were  also  expected  to  take  account  of  each  other's  (fundamentally 
different)  needs.  Transforming  patronage  into  debt  relations — treating, 
say,  an  advance  of  seed  corn  as  a  loan,  let  alone  an  interest-bearing 
loan — changed  all  this.76  What's  more,  it  did  so  in  two  completely 
contradictory  respects.  On  the  one  hand,  a  loan  implies  no  ongoing 
responsibilities  on  the  part  of  the  creditor.  On  the  other,  as  I  have  con- 
tinually emphasized,  a  loan  does  assume  a  certain  formal,  legal  equality 
between  contractor  and  contractee.  It  assumes  that  they  are,  at  least 
in  some  ways  on  some  level,  fundamentally  the  same  kind  of  person. 
This  is  certainly  about  the  most  ruthless  and  violent  form  of  equality 
imaginable.  But  the  fact  it  was  conceived  as  equality  before  the  market 
made  such  arrangements  even  more  difficult  to  endure.77 



The  same  tensions  can  be  observed  between  neighbors,  who  in 
farming  communities  tend  to  give,  lend,  and  borrow  things  amongst 
themselves — anything  from  sieves  and  sickles,  to  charcoal  and  cooking 
oil,  to  seed  corn  or  oxen  for  plowing.  On  the  one  hand,  such  giving 
and  lending  were  considered  essential  parts  of  the  basic  fabric  of  hu- 
man sociability  in  farm  communities,  on  the  other,  overly  demanding 
neighbors  were  a  notorious  irritant — one  that  could  only  have  grown 
worse  when  all  parties  are  aware  of  precisely  how  much  it  would  have 
cost  to  buy  or  rent  the  same  items  that  were  being  given  away.  Again, 
one  of  the  best  ways  to  get  a  sense  of  what  were  considered  everyday 
dilemmas  for  Mediterranean  peasants  is  to  look  at  jokes.  Late  stories 
from  across  the  Aegean  in  Turkey  echo  exactly  the  same  concerns: 

Nasruddin's  neighbor  once  came  by  ask  if  he  could  borrow  his 
donkey  for  an  unexpected  errand.  Nasruddin  obliged,  but  the 
next  day  the  neighbor  was  back  again — he  needed  to  take  some 
grain  to  be  milled.  Before  long  he  was  showing  up  almost  every 
morning,  barely  feeling  he  needed  a  pretext.  Finally,  Nasruddin 
got  fed  up,  and  one  morning  told  him  his  brother  had  already 
come  by  and  taken  the  donkey. 

Just  as  the  neighbor  was  leaving  he  heard  a  loud  braying 
sound  from  the  yard. 

"Hey,  I  thought  you  said  the  donkey  wasn't  here!" 

"Look,  who  are  you  going  to  believe?"  asked  Nasruddin. 
"Me,  or  some  animal?" 

With  the  appearance  of  money,  it  could  also  become  unclear  what 
was  a  gift,  and  what  a  loan.  On  the  one  hand,  even  with  gifts,  it  was 
always  considered  best  to  return  something  slightly  better  than  one  had 
received.78  On  the  other  hand,  friends  do  not  charge  one  another  inter- 
est, and  any  suggestion  that  they  might  was  sure  to  rankle.  So  what's 
the  difference  between  a  generous  return  gift  and  an  interest  payment? 
This  is  the  basis  of  one  of  the  most  famous  Nasruddin  stories,  one  that 
appears  to  have  provided  centuries  of  amusement  for  peasants  across 
the  Mediterranean  basin  and  adjoining  regions.  (It  is  also,  I  might 
note,  a  play  on  the  fact  that  in  many  Mediterranean  languages,  Greek 
included,  the  word  for  "interest"  literally  means  "offspring.") 

One  day  Nasruddin's  neighbor,  a  notorious  miser,  came  by 
to  announce  he  was  throwing  a  party  for  some  friends.  Could 
he  borrow  some  of  Nasruddin's  pots?  Nasruddin  didn't  have 
many  but  said  he  was  happy  to  lend  whatever  he  had.  The  next 



day  the  miser  returned,  carrying  Nasruddin's  three  pots,  and 
one  tiny  additional  one. 

"What's  that?"  asked  Nasrudddin. 

"Oh,  that's  the  offspring  of  the  pots.  They  reproduced  dur- 
ing the  time  they  were  with  me." 

Nasruddin  shrugged  and  accepted  them,  and  the  miser  left 
happy  that  he  had  established  a  principle  of  interest.  A  month 
later  Nasruddin  was  throwing  a  party,  and  he  went  over  to 
borrow  a  dozen  pieces  of  his  neighbor's  much  more  luxurious 
crockery.  The  miser  complied.  Then  he  waited  a  day.  And  then 
another  .  .  . 

On  the  third  day,  the  miser  came  by  and  asked  what  had 
happened  to  his  pots. 

"Oh,  them?"  Nasruddin  said  sadly.  "It  was  a  terrible  trag- 
edy. They  died."7' 

In  a  heroic  system,  it  is  only  debts  of  honor — the  need  to  repay 
gifts,  to  exact  revenge,  to  rescue  or  redeem  friends  or  kinsmen  fallen 
prisoner — that  operate  completely  under  a  logic  of  tit-for-tat  exchange. 
Honor  is  the  same  as  credit;  it's  one's  ability  to  keep  one's  promises, 
but  also,  in  the  case  of  a  wrong,  to  "get  even."  As  the  last  phrase 
implies,  it  was  a  monetary  logic,  but  money,  or  anyway  money-like 
relations,  are  confined  to  this.  Gradually,  subtly,  without  anyone  com- 
pletely understanding  the  full  implications  of  what  was  happening, 
what  had  been  the  essence  of  moral  relations  turned  into  the  means  for 
every  sort  of  dishonest  stratagem. 

We  know  a  little  about  it  from  trial  speeches,  many  of  which  have 
survived.  Here  is  one  from  the  fourth  century,  probably  around  365 
bc.  Apollodorus  was  a  prosperous  but  low-born  Athenian  citizen  (his 
father,  a  banker,  had  begun  life  as  a  slave)  who,  like  many  such  gentle- 
men, had  acquired  a  country  estate.  There  he  made  a  point  of  making 
friends  with  his  closest  neighbor,  Nicostratus,  a  man  of  aristocratic 
origins,  though  currently  of  somewhat  straitened  means.  They  acted  as 
neighbors  normally  did,  giving  and  borrowing  small  sums,  lending  each 
other  animals  or  slaves,  minding  each  other's  property  when  one  was 
away.  Then  one  day  Nicostratus  ran  into  a  piece  of  terrible  luck.  While 
trying  to  track  down  some  runaway  slaves,  he  was  himself  captured  by 
pirates  and  held  for  ransom  at  the  slave  market  on  the  island  of  Aegi- 
na.  His  relatives  could  only  assemble  part  of  the  price,  so  he  was  forced 
:o  borrow  the  rest  from  strangers  in  the  market.  These  appear  to  have 
reen  professionals  who  specialized  in  such  loans,  and  their  terms  were 
notoriously  harsh:  if  not  repaid  in  thirty  days,  the  sum  doubled;  if  not 



repaid  at  all,  the  debtor  became  the  slave  of  the  man  who  had  put  up 
the  money  for  his  redemption. 

Tearfully,  Nicostratus  appealed  to  his  neighbor.  All  his  posses- 
sions were  already  pledged  now  to  one  creditor  or  another;  he  knew 
Apollodorus  wouldn't  have  that  much  cash  lying  around,  but  could 
his  dear  friend  possibly  put  up  something  of  his  own  by  way  of  secu- 
rity? Apollodorus  was  moved.  He  would  be  happy  to  forgive  all  debts 
Nicostratus  already  owed  him,  but  the  rest  would  be  difficult.  Still,  he 
would  do  his  best.  In  the  end,  he  arranged  to  himself  take  a  loan  from 
an  acquaintance  of  his,  Arcesas,  on  the  security  of  his  town-house, 
at  16  percent  annual  interest,  so  as  to  be  able  to  satisfy  Nicostratus's 
creditors  while  Nicostratus  himself  arranged  a  friendly,  no-interest  era- 
nos  loan  from  his  own  relatives.  But  before  long,  Apollodorus  began 
to  realize  that  he  had  been  set  up.  The  impoverished  aristocrat  had 
decided  to  take  advantage  of  his  nouveau-riche  neighbor;  he  was  actu- 
ally working  with  Arcesas  and  some  of  Apollodorus's  enemies  to  have 
him  falsely  declared  a  "public  debtor,"  that  is,  someone  who  had  de- 
faulted on  an  obligation  to  the  public  treasury.  This  would  have  first 
of  all  meant  that  he  would  lose  his  right  to  take  anyone  to  court  (i.e., 
his  deceivers,  to  recover  the  money),  and  second,  would  give  them  a 
pretext  to  raid  his  house  to  remove  his  furniture  and  other  possessions. 
Presumably,  Nicostratus  had  never  felt  especially  comfortable  being  in 
debt  to  a  man  he  considered  his  social  inferior.  Rather  like  Egil  the 
Viking,  who  would  rather  kill  his  friend  Einar  than  have  to  compose  an 
elegy  thanking  him  for  an  overly  magnificent  gift,  Nicostratus  appears 
to  have  concluded  that  it  was  more  honorable,  or  anyway  more  bear- 
able, to  try  to  extract  the  money  from  his  lowly  friend  through  force 
and  fraud  than  to  spend  the  rest  of  his  life  feeling  beholden.  Before 
long,  things  had  indeed  descended  to  outright  physical  violence,  and 
the  whole  matter  ended  up  in  court.80 

The  story  has  everything.  We  see  mutual  aid:  the  communism  of 
the  prosperous,  the  expectation  that  if  the  need  is  great  enough,  or  the 
cost  manageable  enough,  friends  and  neighbors  will  help  one  another.81 
And  most  did,  in  fact,  have  circles  of  people  who  would  pool  money  if 
a  crisis  did  arise:  whether  a  wedding,  a  famine,  or  a  ransom.  We  also 
see  the  omnipresent  danger  of  predatory  violence  that  reduces  human 
beings  to  commodities,  and  by  doing  so  introduces  the  most  cutthroat 
kinds  of  calculation  into  economic  life — not  just  on  the  part  of  the 
pirates,  but  even  more  so,  perhaps,  on  those  moneylenders  lurking 
by  the  market  offering  stiff  credit  terms  to  anyone  who  came  to  ran- 
som their  relatives  but  found  themselves  caught  short,  and  who  then 
could  appeal  to  the  state  to  allow  them  to  hire  men  with  weapons  to 



enforce  the  contract.  We  see  heroic  pride,  which  sees  too  great  an  act 
of  generosity  as  itself  a  kind  of  belittling  assault.  We  see  the  ambigu- 
ity among  gifts,  loans,  and  commercial  credit  arrangements.  Neither 
does  the  way  things  played  out  in  this  case  seem  particularly  unusual, 
except  perhaps  for  Nicostratus's  extraordinarily  ingratitude.  Prominent 
Athenians  were  always  borrowing  money  to  pursue  their  political  proj- 
ects; less-prominent  ones  were  constantly  worrying  about  their  debts, 
or  how  to  collect  from  their  own  debtors.82  Finally,  there  is  another, 
subtler  element  here.  While  everyday  market  transactions,  at  shops 
or  stalls  in  the  agora,  were  here  as  elsewhere  typically  conducted  on 
credit,  the  mass  production  of  coinage  permitted  a  degree  of  anonymity 
for  transactions  that,  in  a  pure  credit  regime,  simply  could  not  exist.83 
Pirates  and  kidnappers  do  business  in  cash — yet  the  loan  sharks  at  Ae- 
gina's  marketplace  could  not  have  operated  without  them.  It  is  on  this 
same  combination  of  illegal  cash  business,  usually  involving  violence, 
and  extremely  harsh  credit  terms,  also  enforced  through  violence,  that 
innumerable  criminal  underworlds  have  been  constructed  ever  since. 

In  Athens,  the  result  was  extreme  moral  confusion.  The  language 
of  money,  debt,  and  finance  provided  powerful — and  ultimately 
irresistible — ways  to  think  about  moral  problems.  Much  as  in  Vedic 
India,  people  started  talking  about  life  as  a  debt  to  the  gods,  of  ob- 
ligations as  debts,  about  literal  debts  of  honor,  of  debt  as  sin  and  of 
vengeance  as  debt  collection.84  Yet  if  debt  was  morality — and  certainly 
at  the  very  least  it  was  in  the  interest  of  creditors,  who  often  had  little 
legal  recourse  to  compel  debtors  to  pay  up,  to  insist  that  it  was — what 
was  one  to  make  of  the  fact  that  money,  that  very  thing  that  seemed 
capable  of  turning  morality  into  an  exact  and  quantifiable  science,  also 
seemed  to  encourage  the  very  worst  sorts  of  behavior? 

It  is  from  such  dilemmas  that  modern  ethics  and  moral  philoso- 
phy begin.  I  think  this  is  true  quite  literally.  Consider  Plato's  Repub- 
lic, another  product  of  fourth-century  Athens.  The  book  begins  when 
Socrates  visits  an  old  friend,  a  wealthy  arms  manufacturer,  at  the  port 
of  Piraeus.  They  get  into  a  discussion  of  justice,  which  begins  when  the 
old  man  proposes  that  money  cannot  be  a  bad  thing,  since  it  allows 
those  who  have  it  to  be  just,  and  that  justice  consists  in  two  things: 
telling  the  truth,  and  always  paying  one's  debts.85  The  proposal  is  easily 
demolished.  What,  Socrates  asks,  if  someone  lent  you  his  sword,  went 
violently  insane,  and  then  asked  for  it  back  (presumably,  so  he  could 
kill  someone)?  Clearly  it  can  never  be  right  to  arm  a  lunatic  whatever 



the  circumstances."6  The  old  man  cheerfully  shrugs  the  problem  off 
and  heads  off  to  attend  to  some  ritual,  leaving  his  son  to  carry  on 
the  argument. 

The  son,  Polemarchus,  switches  gears:  clearly  his  father  hadn't 
meant  "debt"  in  the  literal  sense  of  returning  what  one  has  borrowed. 
He  meant  it  more  in  the  sense  of  giving  people  what  is  owed  to  them; 
repaying  good  with  good  and  evil  with  evil;  helping  one's  friends  and 
hurting  one's  enemies.  Demolishing  this  one  takes  a  little  more  work 
(are  we  saying  justice  plays  no  part  in  determining  who  one's  friends 
and  enemies  are?  If  so,  wouldn't  someone  who  decided  he  had  no 
friends,  and  therefore  tried  to  hurt  everyone,  be  a  just  man?  And  even 
if  you  did  have  some  way  to  say  for  certain  that  one's  enemy  really  is 
an  intrinsically  bad  person  and  deserves  harm,  by  harming  him,  do  you 
not  thus  make  him  worse?  Can  turning  bad  people  into  even  worse 
people  really  be  an  example  of  justice?)  but  it  is  eventually  accom- 
plished. At  this  point  a  Sophist,  Thrasymachos,  enters  and  denounces 
all  of  the  debaters  as  milky-eyed  idealists.  In  reality,  he  says,  all  talk 
of  "justice"  is  mere  political  pretext,  designed  to  justify  the  interests  of 
the  powerful.  And  so  it  should  be,  because  insofar  as  justice  exists,  it 
is  simply  that:  the  interest  of  the  powerful.  Rulers  are  like  shepherds. 
We  like  to  think  of  them  as  benevolently  tending  their  flocks,  but  what 
do  shepherds  ultimately  do  with  sheep?  They  kill  and  eat  them,  or  sell 
the  meat  for  money.  Socrates  responds  by  pointing  out  that  Thrasy- 
machos is  confusing  the  art  of  tending  sheep  with  the  art  of  profiting 
from  them.  The  art  of  medicine  aims  to  improve  health,  whether  or  not 
doctors  get  paid  for  practicing  it.  The  art  of  shepherding  aims  to  ensure 
the  well-being  of  sheep,  whether  or  not  the  shepherd  (or  his  employer) 
is  also  a  businessman  who  knows  how  to  extract  a  profit  from  them. 
Just  so  with  the  art  of  governance.  If  such  an  art  exists,  it  must  have 
its  own  intrinsic  aim  apart  from  any  profit  one  might  also  get  from  it, 
and  what  can  this  be  other  than  the  establishment  of  social  justice?  It's 
only  the  existence  of  money,  Socrates  suggests,  that  allows  us  to  imag- 
ine that  words  like  "power"  and  "interest"  refer  to  universal  realities 
that  can  be  pursued  in  their  own  right,  let  alone  that  all  pursuits  are 
really  ultimately  the  pursuit  of  power,  advantage,  or  self-interest.87  The 
question,  he  said,  is  how  to  ensure  that  those  who  hold  political  office 
will  do  so  not  for  gain,  but  rather  for  honor. 

I  will  leave  off  here.  As  we  all  know,  Socrates  eventually  gets 
around  to  offering  some  political  proposals  of  his  own,  involving  phi- 
losopher kings;  the  abolition  of  marriage,  the  family,  and  private  prop- 
erty; selective  human  breeding  boards.  (Clearly,  the  book  was  meant 
to  annoy  its  readers,  and  for  more  than  two  thousand  years,  it  has 



succeeded  brilliantly.)  What  I  want  to  emphasize,  though,  is  the  degree 
to  which  what  we  consider  our  core  tradition  of  moral  and  political 
theory  today  springs  from  this  question:  What  does  it  mean  to  pay 
our  debts?  Plato  presents  us  first  with  the  simple,  literal  businessman's 
view.  When  this  proves  inadequate,  he  allows  it  to  be  reframed  in  he- 
roic terms.  Perhaps  all  debts  are  really  debts  of  honor  after  all.88  But 
heroic  honor  no  longer  works  in  a  world  where  (as  Apollodorus  sadly 
discovered)  commerce,  class,  and  profit  have  so  confused  everything 
that  peoples'  true  motives  are  never  clear.  How  do  we  even  know  who 
our  enemies  are?  Finally,  Plato  presents  us  with  cynical  realpolitik. 
Maybe  nobody  really  owes  anything  to  anybody.  Maybe  those  who 
pursue  profit  for  its  own  sake  have  it  right  after  all.  But  even  that  does 
not  hold  up.  We  are  left  with  a  certainty  that  existing  standards  are 
incoherent  and  self-contradictory,  and  that  some  sort  of  radical  break 
would  be  required  in  order  to  create  a  world  that  makes  any  logical 
sense.  But  most  of  those  who  seriously  consider  a  radical  break  along 
the  lines  that  Plato  suggested  have  come  to  the  conclusion  that  there 
might  be  far  worse  things  than  moral  incoherence.  And  there  we  have 
stood,  ever  since,  in  the  midst  of  an  insoluble  dilemma. 

It's  not  surprising  that  these  issues  weighed  on  Plato's  mind.  Not  seven 
years  before,  he  had  taken  an  ill-fated  sea  cruise  and  wound  up  being 
captured  and,  supposedly  like  Nicostratus,  offered  for  sale  on  the  auc- 
tion block  at  Aegina.  However,  Plato  had  better  luck.  A  Libyan  phi- 
losopher of  the  Epicurean  school,  one  Annikeris,  happened  to  be  in  the 
market  at  the  time.  He  recognized  Plato  and  ransomed  him.  Plato  felt 
honor-bound  to  try  to  repay  him,  and  his  Athenian  friends  assembled 
twenty  minas  in  silver  with  which  to  do  so,  but  Annikeris  refused  to 
accept  the  money,  insisting  that  it  was  his  honor  to  be  able  to  benefit  a 
fellow  lover  of  wisdom.89  As  indeed  it  was:  Annikeris  has  been  remem- 
bered, and  celebrated,  for  his  generosity  ever  since.  Plato  went  on  to 
use  the  twenty  minas  to  buy  land  for  a  school,  the  famous  Academy. 
And  while  he  hardly  showed  the  same  ingratitude  as  Nicostratus,  one 
does  rather  get  the  impression  that  even  Plato  wasn't  especially  happy 
about  the  fact  that  his  subsequent  career  was,  in  a  sense,  made  pos- 
sible by  his  debt  to  a  man  who  he  probably  considered  an  extremely 
minor  philosopher — and  Annikeris  wasn't  even  Greek!  At  least  this 
would  help  explain  why  Plato,  otherwise  the  inveterate  name-dropper, 
never  mentioned  Annikeris.  We  know  of  his  existence  only  from  later 



Ancient  Rome  (Property  and  Freedom) 

If  Plato's  work  testifies  to  how  profoundly  the  moral  confusion  intro- 
duced by  debt  has  shaped  our  traditions  of  thought,  Roman  law  reveals 
how  much  it  has  shaped  even  our  most  familiar  institutions. 

German  legal  theorist  Rudolf  von  Jhering  famously  remarked 
that  ancient  Rome  had  conquered  the  world  three  times:  the  first  time 
through  its  armies,  the  second  through  its  religion,  the  third  through  its 
laws."  He  might  have  added:  each  time  more  thoroughly.  The  Empire, 
after  all,  only  spanned  a  tiny  portion  of  the  globe;  the  Roman  Catholic 
Church  has  spread  farther;  Roman  law  has  come  to  provide  the  lan- 
guage and  conceptual  underpinnings  of  legal  and  constitutional  orders 
everywhere.  Law  students  from  South  Africa  to  Peru  are  expected  to 
spend  a  good  deal  of  their  time  memorizing  technical  terms  in  Latin, 
and  it  is  Roman  law  that  provides  almost  all  our  basic  conceptions 
about  contract,  obligation,  torts,  property,  and  jurisdiction — and,  in 
a  broader  sense,  of  citizenship,  rights,  and  liberties  on  which  political 
life,  too,  is  based. 

This  was  possible,  Jhering  held,  because,  the  Romans  were  the  first 
to  turn  jurisprudence  into  a  genuine  science.  Perhaps — but  for  all  that, 
it  remains  true  that  Roman  law  has  a  few  notoriously  quirky  features, 
some  so  odd  that  they  have  confused  and  confounded  jurists  ever  since 
Roman  law  was  revived  in  Italian  universities  in  the  High  Middle  Ages. 
The  most  notorious  of  these  is  the  unique  way  it  defines  property.  In 
Roman  law,  property,  or  dominium,  is  a  relation  between  a  person 
and  a  thing,  characterized  by  absolute  power  of  that  person  over  that 
thing.  This  definition  has  caused  endless  conceptual  problems.  First  of 
all,  it's  not  clear  what  it  would  mean  for  a  human  to  have  a  "relation" 
with  an  inanimate  object.  Human  beings  can  have  relations  with  one 
another.  But  what  would  it  mean  to  have  a  "relation"  with  a  thing? 
And  if  one  did,  what  would  it  mean  to  give  that  relation  legal  standing? 
A  simple  illustration  will  suffice:  imagine  a  man  trapped  on  a  desert 
island.  He  might  develop  extremely  personal  relationships  with,  say, 
the  palm  trees  growing  on  that  island.  If  he's  there  too  long,  he  might 
well  end  up  giving  them  all  names  and  spending  half  his  time  having 
imaginary  conversations  with  them.  Still,  does  he  own  them?  The  ques- 
tion is  meaningless.  There's  no  need  to  worry  about  property  rights  if 
noone  else  is  there. 

Clearly,  then,  property  is  not  really  a  relation  between  a  person 
and  a  thing.  It's  an  understanding  or  arrangement  between  people  con- 
cerning things.  The  only  reason  that  we  sometimes  fail  to  notice  this  is 



that  in  many  cases — particularly  when  we  are  talking  about  our  rights 
over  our  shoes,  or  cars,  or  power  tools — we  are  talking  of  rights  held, 
as  English  law  puts  it,  "against  all  the  world" — that  is,  understandings 
between  ourselves  and  everyone  else  on  the  planet,  that  they  will  all 
refrain  from  interfering  with  our  possessions,  and  therefore  allow  us 
to  treat  them  more  or  less  any  way  we  like.  A  relation  between  one 
person  and  everyone  else  on  the  planet  is,  understandably,  difficult  to 
conceive  as  such.  It's  easier  to  think  of  it  as  a  relationship  with  a  thing. 
But  even  here,  in  practice  this  freedom  to  do  as  one  likes  turns  out  to 
be  fairly  limited.  To  say  that  the  fact  that  I  own  a  chainsaw  gives  me 
an  "absolute  power"  to  do  anything  I  want  with  it  is  obviously  absurd. 
Almost  anything  I  might  think  of  doing  with  a  chainsaw  outside  my 
own  home  or  land  is  likely  to  be  illegal,  and  there  are  only  a  limited 
number  of  things  I  can  really  do  with  it  inside.  The  only  thing  "abso- 
lute" about  my  rights  to  a  chainsaw  is  my  right  to  prevent  anyone  else 
from  using  it.92 

Nonetheless,  Roman  law  does  insist  that  the  basic  form  of  property 
is  private  property,  and  that  private  property  is  the  owner's  absolute 
power  to  do  anything  he  wants  with  his  possessions.  Twelfth-century 
Medieval  jurists  came  to  refine  this  into  three  principles,  usus  (use  of 
the  thing),  fructus  (fruits,  i.e.,  enjoyment  of  the  products  of  the  thing), 
and  abusus  (abuse  or  destruction  of  the  thing),  but  Roman  jurists 
weren't  even  interested  in  specifying  that  much,  since  in  a  certain  way, 
they  saw  the  details  as  lying  entirely  outside  the  domain  of  law.  In  fact, 
scholars  have  spent  a  great  deal  of  time  debating  whether  Roman  au- 
thors actually  considered  private  property  to  be  a  right  (/ws),93  for  the 
very  reason  that  rights  were  ultimately  based  on  agreements  between 
people,  and  one's  power  to  dispose  of  one's  property  was  not:  it  was 
just  one's  natural  ability  to  do  whatever  one  pleased  when  social  im- 
pediments were  absent.94 

If  you  think  about  it,  this  really  is  an  odd  place  to  start  in  devel- 
oping a  theory  of  property  law.  It  is  probably  fair  to  say  that,  in  any 
part  of  the  world,  in  any  period  of  history,  whether  in  ancient  Japan 
or  Machu  Picchu,  someone  who  had  a  piece  of  string  was  free  to  twist 
it,  knot  it,  pull  it  apart,  or  toss  it  in  the  fire  more  or  less  as  they  had 
a  mind  to.  Nowhere  else  did  legal  theorists  appear  to  have  found  this 
fact  in  any  way  interesting  or  important.  Certainly  no  other  tradition 
makes  it  the  very  basis  of  property  law — since,  after  all,  doing  so  made 
almost  all  actual  law  little  more  than  a  series  of  exceptions. 

How  did  this  come  about?  And  why?  The  most  convincing  expla- 
nation I've  seen  is  Orlando  Patterson's:  the  notion  of  absolute  private 
property  is  really  derived  from  slavery.  One  can  imagine  property  not 



as  a  relation  between  people,  but  as  a  relation  between  a  person  and 
a  thing,  if  one's  starting  point  is  a  relation  between  two  people,  one 
of  whom  is  also  a  thing.  (This  is  how  slaves  were  defined  in  Roman 
law:  they  were  people  who  were  also  a  res,  a  thing.)95  The  emphasis  on 
absolute  power  begins  to  make  sense  as  well.96 

The  word  dominium,  meaning  absolute  private  property,  was  not 
particularly  ancient.97  It  only  appears  in  Latin  in  the  late  Republic, 
right  around  the  time  when  hundreds  of  thousands  of  captive  laborers 
were  pouring  into  Italy,  and  when  Rome,  as  a  consequence,  was  be- 
coming a  genuine  slave  society.98  By  50  bc,  Roman  writers  had  come  to 
simply  assume  that  workers — whether  the  farmworkers  harvesting  peas 
in  countryside  plantations,  the  muleteers  delivering  those  peas  to  shops 
in  the  city,  or  the  clerks  keeping  count  of  them — were  someone  else's 
property.  The  existence  of  millions  of  creatures  who  were  simultane- 
ously persons  and  things  created  endless  legal  problems,  and  much  of 
the  creative  genius  of  Roman  law  was  spent  in  working  out  the  endless 
ramifications.  One  need  only  flip  open  a  casebook  of  Roman  law  to  get 
a  sense  of  these.  This  is  from  the  second-century  jurist  Ulpian: 

Again,  Mela  writes  that  if  some  persons  were  playing  ball  and 
one  of  them,  hitting  the  ball  quite  hard,  knocked  it  against  a 
barber's  hands,  and  in  this  way  the  throat  of  a  slave,  whom  the 
barber  was  shaving,  was  cut  by  a  razor  pressed  against  it,  then 
who  is  the  person  with  whom  the  culpability  lay  is  liable  under 
the  Lex  Aquilia  [the  law  of  civil  damages]?  Proclus  says  that 
the  culpability  lies  with  the  barber;  and  indeed,  if  he  was  shav- 
ing at  a  place  where  games  are  normally  played  or  where  traffic 
was  heavy,  there  is  reason  to  fault  him.  But  it  would  not  be 
badly  held  that  if  someone  entrusts  himself  to  a  barber  who  has 
a  chair  in  a  dangerous  place,  he  should  have  himself  to  blame.99 

In  other  words,  the  master  cannot  claim  civil  damages  against  the 
ballplayers  or  barber  for  destroying  his  property  if  the  real  problem 
was  that  he  bought  a  stupid  slave.  Many  of  these  debates  might  strike 
us  as  profoundly  exotic  (could  you  be  accused  of  theft  for  merely  con- 
vincing a  slave  to  run  away?  If  someone  killed  a  slave  who  was  also 
your  son,  could  you  take  your  sentimental  feelings  toward  him  into 
account  in  assessing  damages,  or  would  you  have  to  stick  to  his  market 
value?) — but  our  contemporary  tradition  of  jurisprudence  is  founded 
directly  on  such  debates.100 

As  for  dominium,  the  word  is  derived  from  dominus,  meaning  "mas- 
ter" or  "slave-owner,"  but  ultimately  from  domus,  meaning  "house" 



or  "household."  It's  of  course  related  to  the  English  term  "domestic," 
which  even  now  can  be  used  either  to  mean  "pertaining  to  private  life," 
or  to  refer  to  a  servant  who  cleans  the  house.  Domus  overlaps  some- 
what in  meaning  with  familia,  "family" — but,  as  proponents  of  "family 
values"  might  be  interested  to  know,  familia  itself  ultimately  derives 
from  the  word  famulus,  meaning  "slave."  A  family  was  originally  all 
those  people  under  the  domestic  authority  of  a  paterfamilias,  and  that 
authority  was,  in  early  Roman  law  at  least,  conceived  as  absolute.101  A 
man  did  not  have  total  power  over  his  wife,  since  she  was  still  to  some 
degree  under  the  protection  of  her  own  father,  but  his  children,  slaves, 
and  other  dependents  were  his  to  do  with  as  he  wanted — at  least  in 
early  Roman  law,  he  was  perfectly  free  to  whip,  torture,  or  sell  them. 
A  father  could  even  execute  his  children,  provided  he  found  them  to 
have  committed  capital  crimes.102  With  his  slaves,  he  didn't  even  need 
that  excuse. 

In  creating  a  notion  of  dominium,  then,  and  thus  creating  the 
modern  principle  of  absolute  private  property,  what  Roman  jurists 
were  doing  first  of  all  was  taking  a  principle  of  domestic  authority,  of 
absolute  power  over  people,  defining  some  of  those  people  (slaves)  as 
things,  and  then  extending  the  logic  that  originally  applied  to  slaves  to 
geese,  chariots,  barns,  jewelry  boxes,  and  so  forth — that  is,  to  every 
other  sort  of  thing  that  the  law  had  anything  to  do  with. 

It  was  quite  extraordinary,  even  in  the  ancient  world,  for  a  father 
to  have  the  right  to  execute  his  slaves — let  alone  his  children.  No  one 
is  quite  sure  why  the  early  Romans  were  so  extreme  in  this  regard. 
It's  telling,  though,  that  the  earliest  Roman  debt  law  was  equally  un- 
usual in  its  harshness,  since  it  allowed  creditors  to  execute  insolvent 
debtors.103  The  early  history  of  Rome,  like  the  histories  of  early  Greek 
city-states,  was  one  of  continual  political  struggle  between  creditors 
and  debtors,  until  the  Roman  elite  eventually  figured  out  the  principle 
that  most  successful  Mediterranean  elites  learned:  that  a  free  peasantry 
means  a  more  effective  army,  and  that  conquering  armies  can  provide 
war  captives  who  can  do  anything  debt  bondsmen  used  to  do,  and 
therefore,  a  social  compromise — allowing  limited  popular  representa- 
tion, banning  debt  slavery,  channeling  some  of  the  fruits  of  empire  into 
social-welfare  payments — was  actually  in  their  interest.  Presumably, 
the  absolute  power  of  fathers  developed  as  part  of  this  whole  constel- 
lation in  the  same  way  as  we've  seen  elsewhere.  Debt  bondage  reduced 
family  relations  to  relations  of  property;  social  reforms  retained  the 
new  power  of  fathers  but  protected  them  from  debt.  At  the  same  time, 
the  increasing  influx  of  slaves  soon  meant  that  any  even  moderately 
prosperous  household  was  likely  to  contain  slaves.  This  meant  that 



the  logic  of  conquest  extended  into  the  most  intimate  aspects  of  ev- 
eryday life.  Conquered  people  poured  one's  bath  and  combed  one's 
hair.  Conquered  tutors  taught  one's  children  about  poetry.  Since  slaves 
were  sexually  available  to  owners  and  their  families,  as  well  as  to  their 
friends  and  dinner  guests,  it  is  likely  that  most  Romans'  first  sexual 
experience  was  with  a  boy  or  girl  whose  legal  status  was  conceived  as 
that  of  a  defeated  enemy.104 

Over  time,  this  became  more  and  more  of  a  legal  fiction — actual 
slaves  were  much  more  likely  to  have  been  paupers  sold  by  parents, 
unfortunates  kidnapped  by  pirates  or  bandits,  victims  of  wars  or  judi- 
cial process  among  barbarians  at  the  fringes  of  the  empire,  or  children 
of  other  slaves.105  Still,  the  fiction  was  maintained. 

What  made  Roman  slavery  so  unusual,  in  historical  terms,  was  a 
conjuncture  of  two  factors.  One  was  its  very  arbitrariness.  In  dramatic 
contrast  with,  say  plantation  slavery  in  the  Americas,  there  was  no 
sense  that  certain  people  were  naturally  inferior  and  therefore  destined 
to  be  slaves.  Instead,  slavery  was  seen  as  a  misfortune  that  could  hap- 
pen to  anyone.106  As  a  result,  there  was  no  reason  that  a  slave  might 
not  be  in  every  way  superior  to  his  or  her  master:  smarter,  with  a  finer 
sense  of  morality,  better  taste,  and  a  greater  understanding  of  philoso- 
phy. The  master  might  even  be  willing  to  acknowledge  this.  There  was 
no  reason  not  to,  since  it  had  no  effect  on  the  nature  of  the  relation- 
ship, which  was  simply  one  of  power. 

The  second  was  the  absolute  nature  of  this  power.  There  are  many 
places  where  slaves  are  conceived  as  war  captives,  and  masters  as  con- 
querors with  absolute  powers  of  life  and  death — but  usually,  this  is 
something  of  an  abstract  principle.  Almost  everywhere,  governments 
quickly  move  to  limit  such  rights.  At  the  very  least,  emperors  and  kings 
will  insist  that  they  are  the  only  ones  with  the  power  to  order  others 
put  to  death.107  But  under  the  Roman  Republic  there  was  no  emperor; 
insofar  as  there  was  a  sovereign  body,  it  was  the  collective  body  of  the 
slave-owners  themselves.  Only  under  the  early  Empire  do  we  see  any 
legislation  limiting  what  owners  could  do  to  their  (human)  property: 
the  first  being  a  law  of  the  time  of  the  emperor  Tiberius  (dated  16  ad) 
stipulating  that  a  master  had  to  obtain  a  magistrate's  permission  before 
ordering  a  slave  publicly  torn  apart  by  wild  beasts.108  However,  the 
absolute  nature  of  the  master's  power — the  fact  that  in  this  context,  he 
effectively  was  the  state — also  meant  that  there  were  also,  at  first,  no 
restrictions  on  manumission:  a  master  could  liberate  his  slave,  or  even 
adopt  him  or  her,  whereby — since  liberty  meant  nothing  outside  of 
membership  in  a  community — that  slave  automatically  became  a  Ro- 
man citizen.  This  led  to  some  very  peculiar  arrangements.  In  the  first 



century  ad,  for  example,  it  was  not  uncommon  for  educated  Greeks 
to  have  themselves  sold  into  slavery  to  some  wealthy  Roman  in  need 
of  a  secretary,  entrust  the  money  to  a  close  friend  or  family  member, 
and  then,  after  a  certain  interval,  buy  themselves  back,  thus  obtaining 
Roman  citizenship.  This  despite  the  fact  that,  during  such  time  as  they 
were  slaves,  if  their  owner  decided  to,  say,  cut  one  of  his  secretary's 
feet  off,  legally,  he  would  have  been  perfectly  free  to  do  so.109 

The  relation  of  dominus  and  slave  thus  brought  a  relation  of  con- 
quest, of  absolute  political  power  into  the  household  (in  fact,  made  it 
the  essence  of  the  household).  It's  important  to  emphasize  that  this  was 
not  a  moral  relation  on  either  side.  A  well-known  legal  formula,  attrib- 
uted to  a  Republican  lawyer  named  Quintus  Haterius,  brings  this  home 
with  particular  clarity.  With  the  Romans  as  with  the  Athenians,  for  a 
male  to  be  the  object  of  sexual  penetration  was  considered  unbefitting 
to  a  citizen.  In  defending  a  freedman  accused  of  continuing  to  provide 
sexual  favors  to  his  former  master,  Haterius  coined  an  aphorism  that 
was  later  to  become  something  of  a  popular  dirty  joke:  impudicitia  in 
ingenuo  crimen  est,  in  servo  necessitas,  in  liberto  officium  ("to  be  the 
object  of  anal  penetration  is  a  crime  in  the  freeborn,  a  necessity  for  a 
slave,  a  duty  for  a  freedman").110  What  is  significant  here  is  that  sexual 
subservience  is  considered  the  "duty"  only  of  the  freedman.  It  is  not 
considered  the  "duty"  of  a  slave.  This  is  because,  again,  slavery  was 
not  a  moral  relation.  The  master  could  do  what  he  liked,  and  there  was 
nothing  the  slave  could  do  about  it. 

I  I  I  I  I 

The  most  insidious  effect  of  Roman  slavery,  however,  is  that  through 
Roman  law,  it  has  come  to  play  havoc  with  our  idea  of  human  free- 
dom. The  meaning  of  the  Roman  word  libertas  itself  changed  dra- 
matically over  time.  As  everywhere  in  the  ancient  world,  to  be  "free" 
meant,  first  and  foremost,  not  to  be  a  slave.  Since  slavery  means  above 
all  the  annihilation  of  social  ties  and  the  ability  to  form  them,  free- 
dom meant  the  capacity  to  make  and  maintain  moral  commitments  to 
others.  The  English  word  "free,"  for  instance,  is  derived  from  a  Ger- 
man root  meaning  "friend,"  since  to  be  free  meant  to  be  able  to  make 
friends,  to  keep  promises,  to  live  within  a  community  of  equals.  This 
is  why  freed  slaves  in  Rome  became  citizens:  to  be  free,  by  definition, 
meant  to  be  anchored  in  a  civic  community,  with  all  the  rights  and 
responsibilities  that  this  entailed.111 

By  the  second  century  ad,  however,  this  had  begun  to  change. 
The   jurists   gradually   redefined   libertas   until   it   became  almost 



indistinguishable  from  the  power  of  the  master.  It  was  the  right  to  do 
absolutely  anything,  with  the  exception,  again,  of  all  those  things  one 
could  not  do.  Actually,  in  the  Digest,  the  definitions  of  freedom  and 
slavery  appear  back  to  back: 

Freedom  is  .the  natural  faculty  to  do  whatever  one  wishes  that 
is  not  prevented  by  force  or  law.  Slavery  is  an  institution  ac- 
cording to  the  law  of  nations  whereby  one  person  becomes 
private  property  {dominium)  of  another,  contrary  to  nature."2 

Medieval  commentators  immediately  noticed  the  problem  here.113 
But  wouldn't  this  mean  that  everyone  is  free?  After  all,  even  slaves  are 
free  to  do  absolutely  anything  they're  actually  permitted  to  do.  To  say 
a  slave  is  free  (except  insofar  as  he  isn't)  is  a  bit  like  saying  the  earth 
is  square  (except  insofar  as  it  is  round),  or  that  the  sun  is  blue  (except 
insofar  as  it  is  yellow),  or,  again,  that  we  have  an  absolute  right  to 
do  anything  we  wish  with  our  chainsaw  (except  those  things  that  we 

In  fact,  the  definition  introduces  all  sorts  of  complications.  If  free- 
dom is  natural,  then  surely  slavery  is  unnatural,  but  if  freedom  and 
slavery  are  just  matters  of  degree,  then,  logically,  would  not  all  restric- 
tions on  freedom  be  to  some  degree  unnatural?  Would  not  that  imply 
that  society,  social  rules,  in  fact  even  property  rights,  are  unnatural  as 
well?  This  is  precisely  what  many  Roman  jurists  did  conclude — that 
is,  when  they  did  venture  to  comment  on  such  abstract  matters,  which 
was  only  rarely.  Originally,  human  beings  lived  in  a  state  of  nature 
where  all  things  were  held  in  common;  it  was  war  that  first  divided  up 
the  world,  and  the  resultant  "law  of  nations,"  the  common  usages  of 
mankind  that  regulate  such  matters  as  conquest,  slavery,  treaties,  and 
borders,  that  was  first  responsible  for  inequalities  of  property  as  well.114 

This  in  turn  meant  that  there  was  no  intrinsic  difference  between 
private  property  and  political  power — at  least,  insofar  as  that  power 
was  based  in  violence.  As  time  went  on,  Roman  emperors  also  began 
claiming  something  like  dominium,  insisting  that  within  their  domin- 
ions, they  had  absolute  freedom — in  fact,  that  they  were  not  bound  by 
laws."5  At  the  same  time,  as  Roman  society  shifted  from  a  republic  of 
slave-holders  to  arrangements  that  increasingly  resembled  later  feudal 
Europe,  with  magnates  on  their  great  estates  surrounded  by  dependent 
peasants,  debt  servants,  and  an  endless  variety  of  slaves — with  whom 
they  could  largely  do  as  they  pleased.  The  barbarian  invasions  that 
overthrew  the  empire  merely  formalized  the  situation,  largely  eliminat- 
ing chattel  slavery,  but  at  the  same  time  introducing  the  notion  that  the 



noble  classes  were  really  descendants  of  the  Germanic  conquerors,  and 
that  the  common  people  were  inherently  subservient. 

Still,  even  in  this  new  Medieval  world,  the  old  Roman  concept 
of  freedom  remained.  Freedom  was  simply  power.  When  Medieval 
political  theorists  spoke  of  "liberty,"  they  were  normally  referring  to  a 
lord's  right  to  do  whatever  he  wanted  within  his  own  domains.  This 
was,  again,  usually  assumed  to  be  not  something  originally  established 
by  agreement,  but  a  mere  fact  of  conquest:  one  famous  English  legend 
holds  that  when,  around  1290,  King  Edward  I  asked  his  lords  to  pro- 
duce documents  to  demonstrate  by  what  right  they  held  their  franchises 
(or  "liberties"),  the  Earl  Warenne  presented  the  king  only  with  his  rusty 
sword.116  Like  Roman  dominium,  it  was  less  a  right  than  a  power,  and 
a  power  exercised  first  and  foremost  over  people — which  is  why  in  the 
Middle  Ages  it  was  common  to  speak  of  the  "liberty  of  the  gallows," 
meaning  a  lord's  right  to  maintain  his  own  private  place  of  execution. 

By  the  time  Roman  law  began  to  be  recovered  and  modernized  in 
the  twelfth  century,  the  term  dominium  posed  a  particular  problem, 
since  it  had  come,  in  ordinary  church  Latin  of  the  time,  to  be  used 
equally  for  "lordship"  and  "private  property."  Medieval  jurists  spent  a 
great  deal  of  time  and  argument  establishing  whether  there  was  indeed 
a  difference  between  the  two.  It  was  a  particularly  thorny  problem 
because,  if  property  rights  really  were,  as  the  Digest  insisted,  a  form  of 
absolute  power,  it  was  very  difficult  to  see  how  anyone  could  have  it 
but  a  king — or  even,  for  certain  jurists,  God.117 

This  is  not  the  place  to  describe  the  resulting  arguments,  but  I  feel 
it's  important  to  end  here  because  in  a  way,  it  brings  us  full  circle  and 
allows  us  to  understand  precisely  how  Liberals  like  Adam  Smith  were 
able  to  imagine  the  world  the  way  they  did.  This  is  a  tradition  that 
assumes  that  liberty  is  essentially  the  right  to  do  what  one  likes  with 
one's  own  property.  In  fact,  not  only  does  it  make  property  a  right; 
it  treats  rights  themselves  as  a  form  of  property.  In  a  way,  this  is  the 
greatest  paradox  of  all.  We  are  so  used  to  the  idea  of  "having"  rights — 
that  rights  are  something  one  can  possess — that  we  rarely  think  about 
what  this  might  actually  mean.  In  fact  (as  Medieval  jurists  were  well 
aware),  one  man's  right  is  simply  another's  obligation.  My  right  to  free 
speech  is  others'  obligation  not  to  punish  me  for  speaking;  my  right  to 
a  trial  by  a  jury  of  my  peers  is  the  responsibility  of  the  government  to 
maintain  a  system  of  jury  duty.  The  problem  is  just  the  same  as  it  was 
with  property  rights:  when  we  are  talking  about  obligations  owed  by 
everyone  in  the  entire  world,  it's  difficult  to  think  about  it  that  way.  It's 
much  easier  to  speak  of  "having"  rights  and  freedoms.  Still,  if  freedom 
is  basically  our  right  to  own  things,  or  to  treat  things  as  if  we  own 



them,  then  what  would  it  mean  to  "own"  a  freedom — wouldn't  it  have 
to  mean  that  our  right  to  own  property  is  itself  a  form  of  property? 
That  does  seem  unnecessarily  convoluted.  What  possible  reason  would 
one  have  to  want  to  define  it  this  way?118 

Historically,  there  is  a  simple — if  somewhat  disturbing — answer 
to  this.  Those  who  have  argued  that  we  are  the  natural  owners  of  our 
rights  and  liberties  have  been  mainly  interested  in  asserting  that  we 
should  be  free  to  give  them  away,  or  even  to  sell  them. 

Modern  ideas  of  rights  and  liberties  are  derived  from  what,  from 
the  time  when  Jean  Gerson,  Rector  of  the  University  of  Paris,  began 
to  lay  them  out  around  1400,  building  on  Roman  law  concepts,  came 
to  be  known  as  "natural  rights  theory."  As  Richard  Tuck,  the  premier 
historian  of  such  ideas,  has  long  noted,  it  is  one  of  the  great  ironies 
of  history  that  this  was  always  a  body  of  theory  embraced  not  by  the 
progressives  of  that  time,  but  by  conservatives.  "For  a  Gersonian,  lib- 
erty was  property  and  could  be  exchanged  in  the  same  way  and  in  the 
same  terms  as  any  other  property" — sold,  swapped,  loaned,  or  other- 
wise voluntarily  surrendered.11'  It  followed  that  there  could  be  nothing 
intrinsically  wrong  with,  say,  debt  peonage,  or  even  slavery.  And  this 
is  exactly  what  natural-rights  theorists  came  to  assert.  In  fact,  over  the 
next  centuries,  these  ideas  came  to  be  developed  above  all  in  Antwerp 
and  Lisbon,  cities  at  the  very  center  of  the  emerging  slave  trade.  After 
all,  they  argued,  we  don't  really  know  what's  going  on  in  the  lands  be- 
hind places  like  Calabar,  but  there  is  no  intrinsic  reason  to  assume  that 
the  vast  majority  of  the  human  cargo  conveyed  to  European  ships  had 
not  sold  themselves,  or  been  disposed  of  by  their  legal  guardians,  or 
lost  their  liberty  in  some  other  perfectly  legitimate  fashion.  No  doubt 
some  had  not,  but  abuses  will  exist  in  any  system.  The  important  thing 
was  that  there  was  nothing  inherently  unnatural  or  illegitimate  about 
the  idea  that  freedom  could  be  sold.120 

Before  long,  similar  arguments  came  to  be  employed  to  justify  the 
absolute  power  of  the  state.  Thomas  Hobbes  was  the  first  to  really 
develop  this  argument  in  the  seventeenth  century,  but  it  soon  became 
commonplace.  Government  was  essentially  a  contract,  a  kind  of  busi- 
ness arrangement,  whereby  citizens  had  voluntarily  given  up  some  of 
their  natural  liberties  to  the  sovereign.  Finally,  similar  ideas  have  be- 
come the  basis  of  that  most  basic,  dominant  institution  of  our  pres- 
ent economic  life:  wage  labor,  which  is,  effectively,  the  renting  of  our 
freedom  in  the  same  way  that  slavery  can  be  conceived  as  its  sale.121 

It's  not  only  our  freedoms  that  we  own;  the  same  logic  has  come  to 
be  applied  even  to  our  own  bodies,  which  are  treated,  in  such  formu- 
lations, as  really  no  different  than  houses,  cars,  or  furniture.  We  own 



ourselves,  therefore  outsiders  have  no  right  to  trespass  on  us.122  Again, 
this  might  seem  an  innocuous,  even  a  positive  notion,  but  it  looks  rath- 
er different  when  we  take  into  consideration  the  Roman  tradition  of 
property  on  which  it  is  based.  To  say  that  we  own  ourselves  is,  oddly 
enough,  to  cast  ourselves  as  both  master  and  slave  simultaneously. 
"We"  are  both  owners  (exerting  absolute  power  over  our  property), 
and  yet  somehow,  at  the  same  time,  the  things  being  owned  (being  the 
object  of  absolute  power).  The  ancient  Roman  household,  far  from 
having  been  forgotten  in  the  mists  of  history,  is  preserved  in  our  most 
basic  conception  of  ourselves — and,  once  again,  just  as  in  property 
law,  the  result  is  so  strangely  incoherent  that  it  spins  off  into  endless 
paradoxes  the  moment  one  tries  to  figure  out  what  it  would  actually 
mean  in  practice.  Just  as  lawyers  have  spent  a  thousand  years  trying  to 
make  sense  of  Roman  property  concepts,  so  have  philosophers  spent 
centuries  trying  to  understand  how  it  could  be  possible  for  us  to  have  a 
relation  of  domination  over  ourselves.  The  most  popular  solution — to 
say  that  each  of  us  has  something  called  a  "mind"  and  that  this  is  com- 
pletely separate  from  something  else,  which  we  can  call  "the  body," 
and  that  the  first  thing  holds  natural  dominion  over  the  second — flies  in 
the  face  of  just  about  everything  we  now  know  about  cognitive  science. 
It's  obviously  untrue,  but  we  continue  to  hold  onto  it  anyway,  for  the 
simple  reason  that  none  of  our  everyday  assumptions  about  property, 
law,  and  freedom  would  make  any  sense  without  it.123 


The  first  four  chapters  of  this  book  describe  a  dilemma.  We  don't  re- 
ally know  how  to  think  about  debt.  Or,  to  be  more  accurate,  we  seem 
to  be  trapped  between  imagining  society  in  the  Adam  Smith  mode,  as  a 
collection  of  individuals  whose  only  significant  relations  are  with  their 
own  possessions,  happily  bartering  one  thing  for  another  for  the  sake 
of  mutual  convenience,  with  debt  almost  entirely  abolished  from  the 
picture,  and  a  vision  in  which  debt  is  everything,  the  very  substance  of 
all  human  relations — which  of  course  leaves  everyone  with  the  uncom- 
fortable sense  that  human  relations  are  somehow  an  intrinsically  taw- 
dry business,  that  our  very  responsibilities  to  one  another  are  already 
somehow  necessarily  based  in  sin  and  crime.  It's  not  an  appealing  set 
of  alternatives. 

In  the  last  three  chapters  I  have  tried  to  show  that  there  is  another 
way  of  looking  at  things,  and  then  to  describe  how  it  is  that  we  got 



here.  This  is  why  I  developed  the  concept  of  human  economies:  ones 
in  which  what  is  considered  really  important  about  human  beings  is 
the  fact  that  they  are  each  a  unique  nexus  of  relations  with  others — 
therefore,  that  no  one  could  ever  be  considered  exactly  equivalent  to 
anything  or  anyone  else.  In  a  human  economy,  money  is  not  a  way 
of  buying  or  trading  human  beings,  but  a  way  of  expressing  just  how 
much  one  cannot  do  so. 

I  then  went  on  to  describe  how  all  this  can  begin  to  break  down: 
how  humans  can  become  objects  of  exchange:  first,  perhaps,  women 
given  in  marriage;  ultimately,  slaves  captured  in  war.  What  all  these 
relations  have  in  common,  I  observed,  was  violence.  Whether  it  is  Tiv 
girls  being  tied  up  and  beaten  for  running  away  from  their  husbands, 
or  husbands  being  herded  into  slave  ships  to  die  on  faraway  planta- 
tions, that  same  principle  always  applies:  it  is  only  by  the  threat  of 
sticks,  ropes,  spears,  and  guns  that  one  can  tear  people  out  of  those 
endlessly  complicated  webs  of  relationship  with  others  (sisters,  friends, 
rivals  .  .  .)  that  render  them  unique,  and  thus  reduce  them  to  something 
that  can  be  traded. 

All  of  this,  it  is  important  to  emphasize,  can  happen  in  places  where 
markets  in  ordinary,  everyday  goods — clothing,  tools,  foodstuffs — do 
not  even  exist.  In  fact,  in  most  human  economies,  one's  most  important 
possessions  could  never  be  bought  and  sold  for  the  same  reasons  that 
people  can't:  they  are  unique  objects,  caught  up  in  a  web  of  relation- 
ships with  human  beings.124 

My  old  professor  John  Comaroff  used  to  tell  a  story  about  car- 
rying out  a  survey  in  Natal,  in  South  Africa.  He  had  spent  most  of  a 
week  driving  from  homestead  to  homestead  in  a  jeep  with  a  box  full 
of  questionnaires  and  a  Zulu-speaking  interpreter,  driving  past  appar- 
ently endless  herds  of  cattle.  After  about  six  days,  his  interpreter  sud- 
denly started  and  pointed  into  the  middle  of  one  herd.  "Look!"  he  said. 
"That's  the  same  cow!  That  one  there — with  the  red  spot  on  its  back. 
We  saw  it  three  days  ago  in  a  place  ten  miles  from  here.  I  wonder  what 
happened?  Did  someone  get  married?  Or  maybe  there  was  a  settlement 
to  some  dispute." 

In  human  economies,  when  this  ability  to  rip  people  from  their 
contexts  does  appear,  it  is  most  often  seen  as  an  end  in  itself.  One  can 
already  see  a  hint  of  this  among  the  Lele.  Important  men  would  occa- 
sionally acquire  war  captives  from  far  away  as  slaves,  but  it  was  almost 
always  to  be  sacrificed  at  their  funeral.125  The  squelching  of  one  man's 
individuality  was  seen  as  somehow  swelling  the  reputation,  the  social 
existence,  of  the  other.126  In  what  I've  been  calling  heroic  societies,  of 
course  this  kind  of  addition  and  subtraction  of  honor  and  disgrace  is 



lifted  from  a  somewhat  marginal  practice  to  become  the  very  essence  of 
politics.  As  endless  epics,  sagas,  and  eddas  attest,  heroes  become  heroes 
by  making  others  small.  In  Ireland  and  Wales,  we  can  observe  how  this 
very  ability  to  degrade  others,  to  remove  unique  human  beings  from 
their  hearths  and  families  and  thus  render  them  anonymous  units  of 
accounting — the  Irish  slave-girl  currency,  the  Welsh  washerwomen — is 
itself  the  highest  expression  of  honor. 

In  heroic  societies,  the  role  of  violence  is  not  hidden — it's  glorified. 
Often,  it  can  form  the  basis  of  one's  most  intimate  relations.  In  the 
Iliad,  Achilles  sees  nothing  shameful  in  his  relation  with  his  slave-girl, 
Briseis,  whose  husband  and  brothers  he  killed;  he  refers  to  her  as  his 
"prize  of  honor,"  but  almost  in  the  very  same  breath,  he  also  insists 
that,  just  any  decent  man  must  love  and  care  for  his  household  depen- 
dents, "so  I  from  my  heart  loved  this  one,  even  though  I  won  her  with 
my  spear."127 

That  such  relations  of  intimacy  can  often  develop  between  men  of 
honor  and  those  they  have  stripped  of  their  dignity,  history  can  well  at- 
test. After  all,  the  annihilation  of  any  possibility  of  equality  also  elimi- 
nates any  question  of  debt,  of  any  relation  other  than  power.  It  allows 
a  certain  clarity.  This  is  presumably  why  emperors  and  kings  have  such 
a  notorious  tendency  to  surround  themselves  with  slaves  or  eunuchs. 

There  is  something  more  here,  though.  If  one  looks  across  the  ex- 
panse of  history,  one  cannot  help  but  notice  a  curious  sense  of  identi- 
fication between  the  most  exalted  and  the  most  degraded;  particularly, 
between  emperors  and  kings,  and  slaves.  Many  kings  surround  them- 
selves with  slaves,  appoint  slave  ministers — there  have  even  been,  as 
with  the  Mamluks  in  Egypt,  actual  dynasties  of  slaves.  Kings  surround 
themselves  with  slaves  for  the  same  reason  that  they  surround  them- 
selves with  eunuchs:  because  the  slaves  and  criminals  have  no  families 
or  friends,  no  possibility  of  other  loyalties — or  at  least  that,  in  prin- 
ciple, they  shouldn't.  But  in  a  way,  kings  should  really  be  like  that  too. 
As  many  an  African  proverb  emphasizes:  a  proper  king  has  no  relatives 
either,  or  at  least,  he  acts  as  if  he  does  not.128  In  other  words,  the  king 
and  slave  are  mirror  images,  in  that  unlike  normal  human  beings  who 
are  defined  by  their  commitments  to  others,  they  are  defined  only  by 
relations  of  power.  They  are  as  close  to  perfectly  isolated,  alienated 
beings  as  one  can  possibly  become. 

At  this  point  we  can  finally  see  what's  really  at  stake  in  our  pe- 
culiar habit  of  defining  ourselves  simultaneously  as  master  and  slave, 
reduplicating  the  most  brutal  aspects  of  the  ancient  household  in  our 
very  concept  of  ourselves,  as  masters  of  our  freedoms,  or  as  owners 
of  our  very  selves.  It  is  the  only  way  that  we  can  imagine  ourselves  as 



completely  isolated  beings.  There  is  a  direct  line  from  the  new  Roman 
conception  of  liberty — not  as  the  ability  to  form  mutual  relationships 
with  others,  but  as  the  kind  of  absolute  power  of  "use  and  abuse" 
over  the  conquered  chattel  who  make  up  the  bulk  of  a  wealthy  Roman 
man's  household — to  the  strange  fantasies  of  liberal  philosophers  like 
Hobbes,  Locke,  and  Smith,  about  the  origins  of  human  society  in  some 
collection  of  thirty-  or  forty-year-old  males  who  seem  to  have  sprung 
from  the  earth  fully  formed,  then  have  to  decide  whether  to  kill  each 
other  or  begin  to  swap  beaver  pelts.129 

European  and  American  intellectuals,  it  is  true,  have  spent  much 
of  the  last  two  hundred  years  trying  to  flee  from  the  more  disturbing 
implications  of  this  tradition  of  thought.  Thomas  Jefferson,  that  owner 
of  many  slaves,  chose  to  begin  the  Declaration  of  Independence  by  di- 
rectly contradicting  the  moral  basis  of  slavery,  writing  "we  hold  these 
truths  to  be  self-evident,  that  all  men 'are  created  equal,  and  that  they 
are  endowed  by  their  Creator  with  certain  inalienable  Rights  .  .  ." — 
thus  undercutting  simultaneously  any  argument  that  Africans  were 
racially  inferior,  and  also  that  they  or  their  ancestors  could  ever  have 
been  justly  and  legally  deprived  of  their  freedom.  In  doing  so,  however, 
he  did  not  propose  some  radically  new  conception  of  rights  and  liber- 
ties. Neither  have  subsequent  political  philosophers.  For  the  most  part, 
we've  just  kept  the  old  ones,  but  with  the  word  "not"  inserted  here  and 
there.  Most  of  our  most  precious  rights  and  freedoms  are  a  series  of 
exceptions  to  an  overall  moral  and  legal  framework  that  suggests  we 
shouldn't  really  have  them  in  the  first  place. 

Formal  slavery  has  been  eliminated,  but  (as  anyone  who  works 
from  nine  to  five  can  testify)  the  idea  that  you  can  alienate  your  liberty, 
at  least  temporarily,  endures.  In  fact,  it  determines  what  most  of  us 
have  to  do  for  most  of  our  waking  hours,  except,  usually,  on  weekends. 
The  violence  has  been  largely  pushed  out  of  sight.130  But  this  is  largely 
because  we're  no  longer  able  to  imagine  what  a  world  based  on  social 
arrangements  that  did  not  require  the  continual  threat  of  tasers  and 
surveillance  cameras  would  even  look  like. 

Chapter  Eight 


Bullion  is  the  accessory  of  war,  and  not 
of  peaceful  trade. 

— Geoffrey  W.  Gardiner 

ONE  MIGHT  WELL  ASK:  If  our  political  and  legal  ideas  really  are 
founded  on  the  logic  of  slavery,  then  how  did  we  ever  eliminate  slavery? 
Of  course,  a  cynic  might  argue  that  we  haven't;  we've  just  relabeled  it. 
The  cynic  would  have  a  point:  an  ancient  Greek  would  certainly  have 
seen  the  distinction  between  a  slave  and  an  indebted  wage  laborer  as, 
at  best,  a  legalistic  nicety. 1  Still,  even  the  elimination  of  formal  chat- 
tel slavery  has  to  be  considered  a  remarkable  achievement,  and  it  is 
worthwhile  to  wonder  how  it  was  accomplished.  Especially  since  it  was 
not  just  accomplished  once.  The  truly  remarkable  thing,  if  one  consults 
the  historical  record,  is  that  slavery  has  been  eliminated — or  effectively 
eliminated — many  times  in  human  history. 

In  Europe,  for  instance,  the  institution  largely  vanished  in  the 
centuries  following  the  collapse  of  the  Roman  empire — an  historical 
achievement  rarely  recognized  by  those  of  us  used  to  referring  to  these 
events  as  the  beginning  of  "the  Dark  Ages."2  No  one  is  quite  sure  how 
it  happened.  Most  agree  that  the  spread  of  Christianity  must  have  had 
something  to  do  with  it,  but  that  can't  have  been  the  direct  cause,  since 
the  Church  itself  was  never  explicitly  opposed  to  the  institution  and 
in  many  cases  defended  it.  Instead,  the  abolition  appears  to  have  hap- 
pened despite  the  attitudes  of  both  the  intellectuals  and  the  political 
authorities  of  the  time.  Yet  it  did  happen,  and  it  had  lasting  effects. 
On  the  popular  level,  slavery  remained  so  universally  detested  that 
even  a  thousand  years  later,  when  European  merchants  started  try- 
ing to  revive  the  trade,  they  discovered  that  their  compatriots  would 



not  countenance  slaveholding  in  their  own  countries — one  reason  why 
planters  were  eventually  obliged  to  acquire  their  slaves  in  Africa  and 
set  up  plantations  in  the  New  World.3  It  is  one  of  the  great  ironies 
of  history  that  modern  racism — probably  the  single  greatest  evil  of 
our  last  two  centuries — had  to  be  invented  largely  because  Europeans 
continued  to  refuse  to  listen  to  the  arguments  of  the  intellectuals  and 
jurists  and  did  not  accept  that  anyone  they  believed  to  be  a  full  and 
equal  human  being  could  ever  be  justifiably  enslaved. 

What's  more,  the  demise  of  ancient  slavery  was  not  limited  to 
Europe.  Remarkably,  right  around  the  same  time — in  the  years  around 
600  ad — we  find  almost  exactly  the  same  thing  happening  in  India  and 
China,  where,  over  the  course  of  centuries,  amidst  much  unrest  and 
confusion,  chattel  slavery  largely  ceased  to  exist.  What  all  this  suggests 
is  that  moments  of  historical  opportunity — moments  when  meaningful 
change  is  possible — follow  a  distinct,  even  a  cyclical  pattern,  one  that 
has  long  been  far  more  coordinated  across  geographical  space  than  we 
would  ever  have  imagined.  There  is  a  shape  to  the  past,  and  it  is  only 
by  understanding  it  that  we  can  begin  to  have  a  sense  of  the  historical 
opportunities  that  exist  in  the  present. 

The  easiest  way  to  make  these  cycles  visible  is  to  reexamine  exactly  the 
phenomenon  we've  been  concerned  with  over  the  course  of  this  book: 
the  history  of  money,  debt,  and  credit.  The  moment  we  begin  to  map 
the  history  of  money  across  the  last  five  thousand  years  of  Eurasian 
history,  startling  patterns  begin  to  emerge.  In  the  case  of  money,  one 
event  stands  out  above  all  others:  the  invention  of  coinage.  Coinage 
appears  to  have  arisen  independently  in  three  different  places,  almost 
simultaneously:  on  the  Great  Plain  of  northern  China,  in  the  Ganges 
river  valley  of  northeast  India,  and  in  the  lands  surrounding  the  Aegean 
Sea,  in  each  case,  between  roughly  600  and  500  bc.  This  wasn't  due  to 
some  sudden  technological  innovation:  the  technologies  used  in  mak- 
ing the  first  coins  were,  in  each  case,  entirely  different.4  It  was  a  social 
transformation.  Why  this  happened  in  exactly  this  way  is  an  historical 
mystery.  But  this  much  we  know:  for  some  reason,  in  Lydia,  India,  and 
China,  local  rulers  decided  that  whatever  longstanding  credit  systems 
had  existed  in  their  kingdoms  were  no  longer  adequate,  and  they  began 
to  issue  tiny  pieces  of  precious  metals — metals  that  had  previously  been 
used  largely  in  international  commerce,  in  ingot  form — and  to  encour- 
age their  subjects  to  use  them  in  day-to-day  transactions. 



From  there,  the  innovation  spread.  For  more  than  a  thousand 
years,  states  everywhere  started  issuing  their  own  coinage.  But  then, 
right  around  600  ad,  about  the  time  that  slavery  was  disappearing,  the 
whole  trend  was  suddenly  thrown  into  reverse.  Cash  dried  up.  Every- 
where, there  was  a  movement  back  to  credit  once  again. 

If  we  look  at  Eurasian  history  over  the  course  of  the  last  five  thou- 
sand years,  what  we  see  is  a  broad  alternation  between  periods  domi- 
nated by  credit  money  and  periods  in  which  gold  and  silver  come  to 
dominate — that  is,  those  during  which  at  least  a  large  share  of  transac- 
tions were  conducted  with  pieces  of  valuable  metal  being  passed  from 
hand  to  hand. 

Why?  The  single  most  important  factor  would  appear  to  be  war. 
Bullion  predominates,  above  all,  in  periods  of  generalized  violence. 
There's  a  very  simple  reason  for  that.  Gold  and  silver  coins  are  distin- 
guished from  credit  arrangements  by  one  spectacular  feature:  they  can 
be  stolen.  A  debt  is,  by  definition,  a  record,  as  well  as  a  relation  of 
trust.  Someone  accepting  gold  or  silver  in  exchange  for  merchandise, 
on  the  other  hand,  need  trust  nothing  more  than  the  accuracy  of  the 
scales,  the  quality  of  the  metal,  and  the  likelihood  that  someone  else 
will  be  willing  to  accept  it.  In  a  world  where  war  and  the  threat  of 
violence  are  everywhere — and  this  appears  to  have  been  an  equally  ac- 
curate description  of  Warring  States  China,  Iron  Age  Greece,  and  pre- 
Mauryan  India — there  are  obvious  advantages  to  making  one's  trans- 
actions simple.  This  is  all  the  more  true  when  dealing  with  soldiers. 
On  the  one  hand,  soldiers  tend  to  have  access  to  a  great  deal  of  loot, 
much  of  which  consists  of  gold  and  silver,  and  will  always  seek  a  way 
to  trade  it  for  the  better  things  in  life.  On  the  other,  a  heavily  armed 
itinerant  soldier  is  the  very  definition  of  a  poor  credit  risk.  The  econo- 
mists' barter  scenario  might  be  absurd  when  applied  to  transactions 
between  neighbors  in  the  same  small  rural  community,  but  when  deal- 
ing with  a  transaction  between  the  resident  of  such  a  community  and 
a  passing  mercenary,  it  suddenly  begins  to  make  a  great  deal  of  sense. 

For  much  of  human  history,  then,  an  ingot  of  gold  of  silver, 
stamped  or  not,  has  served  the  same  role  as  the  contemporary  drug 
dealer's  suitcase  full  of  unmarked  bills:  an  object  without  a  history, 
valuable  because  one  knows  it  will  be  accepted  in  exchange  for  other 
goods  just  about  anywhere,  no  questions  asked.  As  a  result,  while 
credit  systems  tend  to  dominate  in  periods  of  relative  social  peace,  or 
across  networks  of  trust  (whether  created  by  states  or,  in  most  periods, 
transnational  institutions  like  merchant  guilds  or  communities  of  faith), 
in  periods  characterized  by  widespread  war  and  plunder,  they  tend  to 
be  replaced  by  precious  metal.  What's  more,  while  predatory  lending 



goes  on  in  every  period  of  human  history,  the  resulting  debt  crises  ap- 
pear to  have  the  most  damaging  effects  at  times  when  money  is  most 
easily  convertible  into  cash. 

As  a  starting  point  to  any  attempt  to  discern  the  great  rhythms 
that  define  the  current  historical  moment,  let  me  propose  the  following 
breakdown  of  Eurasian  history  according  to  the  alternation  between 
periods  of  virtual  and  metal  money.  The  cycle  begins  with  the  Age  of 
the  First  Agrarian  Empires  (3500-800  bc),  dominated  by  virtual  credit 
money.  This  is  followed  by  the  Axial  Age  (800  BC-600  ad),  which  will 
be  covered  in  the  next  chapter,  and  which  saw  the  rise  of  coinage  and 
a  general  shift  to  metal  bullion.  The  Middle  Ages  (600-1450  ad),  which 
saw  a  return  to  virtual  credit  money,  will  be  covered  in  chapter  10; 
chapter  11  will  cover  the  next  turn  of  the  cycle,  the  Age  of  Capitalist 
Empires,  which  began  around  1450  with  a  massive  planetary  switch 
back  to  gold  and  silver  bullion,  and  which  could  only  really  be  said 
to  have  ended  in  1971,  when  Richard  Nixon  announced  that  the  U.S. 
dollar  would  no  longer  be  redeemable  in  gold.  This  marked  the  begin- 
ning of  yet  another  phase  of  virtual  money,  one  which  has  only  just 
begun,  and  whose  ultimate  contours  are,  necessarily,  invisible.  Chapter 
12,  the  final  chapter,  will  be  devoted  to  applying  the  insights  of  history 
to  understanding  what  it  might  mean  and  the  opportunities  it  might 
throw  open. 

(3500-800  BC) 

We  have  already  had  occasion  to  note  the  predominance  of  credit 
money  in  Mesopotamia,  the  earliest  urban  civilization  that  we  know 
about.  In  the  great  temple  and  palace  complexes,  not  only  did  money 
serve  largely  as  an  accounting  measure  rather  than  physically  changing 
hands,  merchants  and  tradespeople  developed  credit  arrangements  of 
their  own.  Most  of  these  took  the  physical  form  of  clay  tablets,  in- 
scribed with  some  obligation  of  future  payment,  that  were  then  sealed 
inside  clay  envelopes  and  marked  with  the  borrower's  seal.  The  credi- 
tor would  keep  the  envelope  as  a  surety,  and  it  would  be  broken  open 
on  repayment.  In  some  times  or  places  at  least,  these  bullae  appear  to 
have  become  what  we  would  now  call  negotiable  instruments,  since 
the  tablet  inside  did  not  simply  record  a  promise  to  pay  the  original 
lender,  but  was  designated  "to  the  bearer" — in  other  words,  a  tablet 
recording  a  debt  of  five  shekels  of  silver  (at  prevailing  rates  of  interest) 



could  circulate  as  the  equivalent  of  a  five-shekel  promissory  note — that 
is,  as  money.5 

We  don't  know  how  often  this  happened;  how  many  hands  such 
tablets  would  typically  pass  through,  how  many  transactions  were 
based  on  credit,  how  often  merchants  actually  did  weigh  out  silver  in 
rough  chunks  to  buy  and  sell  their  merchandise,  or  when  they  were 
most  likely  to  do  so.  No  doubt  all  this  varied  over  time.  Promissory 
notes  usually  circulated  within  merchant  guilds,  or  between  inhabitants 
of  the  relatively  well-off  urban  neighborhoods  where  people  knew  one 
another  well  enough  to  trust  them  to  be  accountable,  but  not  so  well 
that  they  could  rely  on  one  another  for  more  traditional  forms  of  mu- 
tual aid.6  We  know  even  less  about  the  marketplaces  frequented  by  or- 
dinary Mesopotamians,  except  that  tavern-keepers  operated  on  credit, 
and  hawkers  and  operators  of  market  stalls  probably  did  as  well.7 

The  origins  of  interest  will  forever  remain  obscure,  since  they  pre- 
ceded the  invention  of  writing.  The  terminology  for  interest  in  most 
ancient  languages  is  derived  from  some  word  for  "offspring,"  causing 
some  to  speculate  that  it  originates  in  loans  of  livestock,  but  this  seems 
a  bit  literal-minded.  More  likely,  the  first  widespread  interest-bearing 
loans  were  commercial:  temples  and  palaces  would  forward  wares  to 
merchants  and  commercial  agents,  who  would  then  trade  them  in  near- 
by mountain  kingdoms  or  on  trading  expeditions  overseas.8 

The  practice  is  significant  because  it  implies  a  fundamental  lack 
of  trust.  After  all,  why  not  simply  demand  a  share  in  the  profits?  This 
seems  more  fair  (a  merchant  who  came  back  bankrupt  would  probably 
have  little  means  of  paying  anyway),  and  profit-sharing  partnerships 
of  this  sort  became  common  practice  in  the  later  Middle  East.9  The 
answer  seems  to  be  that  profit-sharing  partnerships  were  typically  con- 
tracted between  merchants,  or  anyway  people  of  similar  background 
and  experience  who  had  ways  of  keeping  track  of  one  another.  Palace 
or  temple  bureaucrats  and  world-roaming  merchant  adventurers  had 
little  in  common,  and  the  bureaucrats  seem  to  have  concluded  that  one 
could  not  normally  expect  a  merchant  returned  from  a  far-off  land  to 
be  entirely  honest  about  his  adventures.  A  fixed  interest  rate  would 
render  irrelevant  whatever  elaborate  tales  of  robbery,  shipwreck,  or 
attacks  by  winged  snakes  or  elephants  a  creative  merchant  might  have 
concocted.  The  return  was  fixed  in  advance. 

This  connection  between  borrowing  and  lying,  incidentally,  is  an 
important  one  to  history.  Herodotus  remarked  about  the  Persians:  "To 
tell  a  lie  is  considered  by  them  the  greatest  disgrace,  and  next  to  that 
to  be  in  debt  .  .  .  especially  because  they  think  that  one  in  debt  must  of 
necessity  tell  lies."10  (Later,  Herodotus  reported  a  story  told  to  him  by 



a  Persian  about  the  origins  of  the  gold  that  the  Persians  had  acquired 
in  India:  they  stole  it  from  the  nests  of  giant  ants.)11  Jesus's  parable  of 
the  unforgiving  servant  makes  a  joke  out  of  the  matter  ("Ten  thousand 
talents?  No  problem.  Just  give  me  a  little  more  time"),  but  even  here, 
one  can  see  how  such  endless  falsehoods  contributed  to  a  broader  sense 
that  a  world  in  which  moral  relations  are  conceived  as  debts  is  also, 
while  in  certain  ways  entertaining,  necessarily  a  world  of  corruption, 
guilt,  and  sin. 

By  the  time  of  the  earliest  Sumerian  documents,  this  world  may 
not  yet  have  arrived.  Still,  the  principle  of  lending  at  interest,  even 
compound  interest,  was  already  familiar  to  everyone.  In  2402  bc,  for 
instance,  a  royal  inscription  by  King  Enmetena  of  Lagash — one  of  the 
earliest  we  have — complains  that  his  enemy,  the  King  of  Umma,  had 
been  occupying  a  huge  stretch  of  farmland  that  had  rightfully  belonged 
to  Lagash  for  decades.  He  announces:  if  one  were  to  calculate  the 
rental  fees  for  all  that  land,  then  the  interest  that  would  have  been  due 
on  that  rent,  compounded  annually,  it  would  reveal  that  Umma  now 
owes  Lagash  four  and  a  half  trillion  liters  of  barley.  The  sum  was,  as  in 
the  parable,  intentionally  preposterous.12  It  was  just  an  excuse  to  start 
a  war.  Still,  he  wanted  everyone  to  know  that  he  knew  exactly  how  to 
do  the  math. 

Usury — in  the  sense  of  interest-bearing  consumer  loans — was  also 
well  established  by  Enmetena's  time.  The  king  ultimately  had  his  war 
and  won  it,  and  two  years  later,  fresh  off  his  victory,  he  was  forced  to 
publish  another  edict:  this  one,  a  general  debt  cancellation  within  his 
kingdom.  As  he  later  boasted,  "he  instituted  freedom  {amargi)  in  La- 
gash. He  restored  the  child  to  its  mother,  and  the  mother  to  her  child; 
he  cancelled  all  interest  due."13  This  was,  in  fact,  the  very  first  such 
declaration  we  have  on  record — and  the  first  time  in  history  that  the 
word  "freedom"  appears  in  a  political  document. 

Enmetena's  text  is  a  bit  vague  on  the  details,  but  a  half-century 
later,  when  his  successor  Uruinimgina  declared  a  general  amnesty  dur- 
ing the  New  Year's  ceremonies  of  2350  bc,  the  terms  are  all  spelled  out, 
and  they  conform  to  what  was  to  become  typical  of  such  amnesties: 
cancelling  not  only  all  outstanding  loans,  but  all  forms  of  debt  servi- 
tude, even  those  based  on  failure  to  pay  fees  or  criminal  penalties — the 
only  thing  excepted  being  commercial  loans. 

Similar  declarations  are  to  be  found  again  and  again,  in  Sumerian 
and  later  Babylonian  and  Assyrian  records,  and  always  with  the  same 
theme:  the  restoration  of  "justice  and  equity,"  the  protection  of  wid- 
ows and  orphans,  to  ensure — as  Hammurabi  was  to  put  it  when  he 



abolished  debts  in  Babylon  in  1761  bc — "that  the  strong  might  not  op- 
press the  weak."14  In  the  words  of  Michael  Hudson, 

The  designated  occasion  for  clearing  Babylonia's  financial  slate 
was  the  New  Year  festival,  celebrated  in  the  spring.  Babylo- 
nian rulers  oversaw  the  ritual  of  "breaking  the  tablets,"  that 
is,  the  debt  records,  restoring  economic  balance  as  part  of  the 
calendrical  renewal  of  society  along  with  the  rest  of  nature. 
Hammurabi  and  his  fellow  rulers  signaled  these  proclamations 
by  raising  a  torch,  probably  symbolizing  the  sun-god  of  justice 
Shamash,  whose  principles  were  supposed  to  guide  wise  and 
fair  rulers.  Persons  held  as  debt  pledges  were  released  to  rejoin 
their  families.  Other  debtors  were  restored  cultivation  rights 
to  their  customary  lands,  free  of  whatever  mortgage  liens  had 

Over  the  next  several  thousand  years,  this  same  list — cancelling  the 
debts,  destroying  the  records,  reallocating  the  land — was  to  become 
the  standard  list  of  demands  of  peasant  revolutionaries  everywhere.  In 
Mesopotamia,  rulers  appear  to  have  headed  off  the  possibility  of  unrest 
by  instituting  such  reforms  themselves,  as  a  grand  gesture  of  cosmic 
renewal,  a  recreation  of  the  social  universe — in  Babylonia,  during  the 
same  ceremony  in  which  the  king  reenacts  his  god  Marduk's  creation 
of  the  physical  universe.  The  history  of  debt  and  sin  was  wiped  out, 
and  it  was  time  to  begin  again.  But  it's  also  clear  what  they  saw  as 
the  alternative:  the  world  plunged  into  chaos,  with  farmers  defect- 
ing to  swell  the  ranks  of  nomadic  pastoralists,  and  ultimately,  if  the 
breakdown  continued,  returning  to  overrun  the  cities  and  destroy  the 
existing  economic  order  entirely. 


(2650-716  BC) 

Egypt  represents  an  interesting  contrast,  since  for  most  of  its  history, 
it  managed  to  avoid  the  development  of  interest-bearing  debt  entirely. 

Egypt  was,  like  Mesopotamia,  extraordinarily  rich  by  ancient  stan- 
dards, but  it  was  also  a  self-contained  society,  a  river  running  through 
a  desert,  and  far  more  centralized  than  Mesopotamia.  The  pharaoh 
was  a  god,  and  the  state  and  temple  bureaucracies  had  their  hands 
in  everything:  there  were  a  dazzling  array  of  taxes  and  a  continual 



distribution  of  allotments,  wages,  and  payments  from  the  state.  Here, 
too,  money  clearly  arose  as  a  means  of  account.  The  basic  unit  was 
the  deben,  or  "measure" — originally  referring  to  measures  of  grain,  and 
later  of  copper  or  silver.  A  few  records  make  clear  the  catch-as-catch- 
can  nature  of  most  transactions: 

In  the  15th  year  of  Ramses  II  [c.  1275  BC]  a  merchant  offered 
the  Egyptian  lady  Erenofre  a  Syrian  slave  girl  whose  price,  no 
doubt  after  bargaining,  was  fixed  at  4  deben  1  kite  [about  373 
grams]  of  silver.  Erenofre  made  up  a  collection  of  clothes  and 
blankets  to  the  value  of  2  deben  2  1/3  kite — the  details  are  set 
out  in  the  record — and  then  borrowed  a  miscellany  of  objects 
from  her  neighbors — bronze  vessels,  a  pot  of  honey,  ten  shirts, 
ten  deben  of  copper  ingots — till  the  price  was  made  up.16 

Most  merchants  were  itinerant,  either  foreigners  or  commercial 
agents  for  the  owners  of  large  estates.  There's  not  much  evidence  for 
commercial  credit,  however;  loans  in  Egypt  were  still  more  likely  to 
take  the  form  of  mutual  aid  between  neighbors.17 

Substantial,  legally  enforceable  loans,  the  kind  that  can  lead  to  the 
loss  of  lands  or  family  members,  are  documented,  but  they  appear  to 
have  been  rare — and  much  less  pernicious,  as  the  loans  did  not  bear 
interest.  Similarly,  we  do  occasionally  hear  of  debt-bondservants,  and 
even  debt  slaves,  but  these  seem  to  have  been  unusual  phenomena  and 
there's  no  suggestion  that  matters  ever  reached  crisis  proportions,  as 
they  so  regularly  did  in  Mesopotamia  and  the  Levant.18 

In  fact,  for  the  first  several  thousand  years,  we  seem  to  be  in  a 
somewhat  different  world,  where  debt  really  was  a  matter  of  "guilt" 
and  treated  largely  as  a  criminal  matter: 

When  a  debtor  failed  to  repay  his  debt  on  time,  his  creditor 
could  take  him  to  court,  where  the  debtor  would  be  required 
to  promise  to  pay  in  full  by  a  specific  date.  As  part  of  his 
promise — which  was  under  oath — the  debtor  also  pledged  to 
undergo  100  blows  and/or  repay  twice  the  amount  of  the  origi- 
nal loan  if  he  failed  to  pay  by  the  date  specified.19 

The  "and/or"  is  significant.  There  was  no  formal  distinction  be- 
tween a  fine  and  a  beating.  In  fact,  the  entire  purpose  of  the  oath 
(rather  like  the  Cretan  custom  of  having  a  borrower  pretend  to  snatch 
the  money)  seems  to  have  been  to  create  the  justification  for  punitive 
action:  so  the  debtor  could  be  punished  as  either  a  perjurer  or  a  thief.20 



By  the  time  of  the  New  Kingdom  (1550-1070)  there  is  more  evi- 
dence for  markets,  but  it's  only  by  the  time  we  reach  the  Iron  Age, 
just  before  Egypt  was  absorbed  into  the  Persian  empire,  that  we  begin 
to  see  evidence  for  Mesopotamian-style  debt  crises.  Greek  sources,  for 
instance,  record  that  the  Pharaoh  Bakenranef  (reigned  720-715  bc)  is- 
sued a  decree  abolishing  debt  bondage  and  annulling  all  outstanding 
liabilities,  since  "he  felt  it  would  be  absurd  for  a  soldier,  perhaps  at 
the  moment  when  he  was  setting  forth  to  fight  for  his  fatherland,  to 
be  hauled  off  to  prison  by  his  creditor  for  an  unpaid  loan" — which, 
if  true,  is  also  one  of  the  earliest  mentions  of  a  debt  prison.21  Under 
the  Ptolemies,  the  Greek  dynasty  that  ruled  Egypt  after  Alexander, 
periodic  clean  slates  had  become  institutionized.  It's  well  known  that 
the  Rosetta  Stone,  written  both  in  Greek  and  Egyptian,  proved  to  be 
the  key  that  made  it  possible  to  translate  Egyptian  hieroglyphics.  Few 
are  aware  of  what  it  actually  says.  The  stela  was  originally  raised  to 
announce  an  amnesty,  both  for  debtors  and  for  prisoners,  declared  by 
Ptolemy  V  in  196  bc.22 


(2200-771  BC) 

We  can  say  almost  nothing  about  Bronze  Age  India,  since  its  writ- 
ing remains  indecipherable,  and  not  much  more  about  Early  China. 
What  little  we  do  know — mainly  culled  from  dribs  and  drabs  in  later 
literary  sources — suggests  that  the  earliest  Chinese  states  were  far  less 
bureaucratic  than  their  western  cousins.23  There  being  no  centralized 
temple  or  palace  system  with  priests  and  administrators  managing  the 
storerooms  and  recording  inputs  and  outputs,  there  was  also  little  in- 
centive to  create  a  single,  uniform  unit  of  account.  Instead,  the  evidence 
suggests  a  different  path,  with  social  currencies  of  various  sorts  still 
holding  sway  in  the  countryside  and  being  converted  to  commercial 
purposes  in  dealings  between  strangers. 

Later  sources  recall  that  early  rulers  "used  pearls  and  jade  as  their 
superior  method  of  payment,  gold  as  their  middle  method  of  pay- 
ment, and  knives  and  spades  as  their  lower  method  of  payment."24  The 
author  can  only  be  talking  about  gifts  here,  and  hierarchical  ones  at 
that:  kings  and  great  magnates  rewarding  their  followers  for  services 
in  theory  rendered  voluntarily.  In  most  places,  long  strings  of  cowrie 
shells  figure  prominently,  but  even  here,  though  we  often  hear  of  "the 
cowrie  money  of  early  China,"  and  it's  easy  enough  to  find  texts  in 



which  the  value  of  sumptuous  gifts  are  measured  in  cowries,  it's  never 
clear  whether  people  were  really  carrying  them  around  to  buy  and  sell 
things  in  the  marketplace.25 

The  most  likely  interpretation  is  that  they  were  carrying  the  shells, 
but  for  a  long  time  marketplaces  themselves  were  of  minor  significance, 
so  this  use  was  not  nearly  as  important  as  the  usual  uses  for  social 
currencies:  marriage  presents,  fines,  fees,  and  tokens  of  honor.26  At  any 
rate,  all  sources  insist  that  there  was  a  wide  variety  of  currencies  in  cir- 
culation. As  David  Scheidel,  one  of  the  premier  contemporary  scholars 
of  early  money,  notes: 

In  pre-imperial  China,  money  took  the  form  of  cowrie  shells, 
both  originals  and — increasingly — bronze  imitations,  tor- 
toise shells,  weighed  gold  and  (rarely)  silver  bars,  and  most 
notably — from  at  least  iooo  BC  onward — utensil  money  in  the 
shape  of  spade  blades  and  knives  made  of  bronze.27 

These  were  most  often  used  between  people  who  didn't  know  each 
other  very  well.  For  tabulating  debts  between  neighbors,  with  local 
vendors,  or  with  anything  having  to  do  with  the  government,  people 
appear  to  have  employed  a  variety  of  credit  instruments:  later  Chi- 
nese historians  claimed  that  the  earliest  of  these  were  knotted  strings, 
rather  like  the  Inca  khipu  system,  and  then  later,  notched  strips  of 
wood  or  bamboo.28  As  in  Mesopotamia,  these  appear  to  have  long 
predated  writing. 

We  don't  really  know  when  the  practice  of  lending  at  interest 
first  reached  China  either,  or  whether  Bronze  Age  China  came  to  see 
the  same  sorts  of  debt  crises  as  occurred  in  Mesopotamia,  but  there 
are  tantalizing  hints  in  later  documents.29  For  instance,  later  Chinese 
legends  about  the  origin  of  coinage  ascribed  the  invention  to  emper- 
ors trying  to  relieve  the  effects  of  natural  disasters.  One  early  Han 
text  reports: 

In  ancient  times,  during  the  floods  of  Yu  and  the  droughts  of 
Tang,  the  common  people  became  so  exhausted  that  they  were 
forced  to  borrow  from  one  another  in  order  to  obtain  food 
and  clothing.  [Emperor]  Yu  coined  money  for  his  people  from 
the  gold  of  Mount  Li  and  [Emperor]  Tang  did  likewise  from 
the  copper  of  Mount  Yan.  Therefore  the  world  called  them 



Other  versions  are  a  little  more  explicit.  The  Guanzi,  a  collection 
that  in  early  imperial  China  became  the  standard  primer  on  political 
economy,  notes  "There  were  people  who  lacked  even  gruel  to  eat,  and 
who  were  forced  to  sell  their  children.  To  rescue  these  people,  Tang 
coined  money."31 

The  story  is  clearly  fanciful  (the  real  origins  of  coined  money  were 
at  least  a  thousand  years  later),  and  it  is  very  hard  to  know  what  to 
make  of  it.  Could  this  reflect  a  memory  of  children  being  taken  away  as 
debt  sureties?  On  the  face  of  it,  it  seems  more  like  starving  people  sell- 
ing their  children  outright — a  practice  that  was  later  to  become  com- 
monplace in  certain  periods  of  Chinese  history.32  But  the  juxtaposition 
of  loans  and  the  sale  of  children  is  suggestive,  especially  considering 
what  was  happening  on  the  other  side  of  Asia  at  exactly  the  same  time. 
The  Guanzi  later  goes  on  to  explain  that  these  same  rulers  instituted 
the  custom  of  retaining  30  percent  of  the  harvest  in  public  granaries 
for  redistribution  in  emergencies,  so  as  to  ensure  that  this  would  never 
happen  again.  In  other  words,  they  began  to  set  up  just  the  kind  of 
bureaucratic  storage  facilities  that,  in  places  like  Egypt  and  Mesopota- 
mia, had  been  responsible  for  creating  money  as  a  unit  of  account  to 
begin  with. 

Chapter  Nine 

(800  BC  -  600  AD) 

Let  us  designate  this  period  as  the 
"axial  age."  Extraordinary  events  are 
crowded  into  this  period,  in  China  lived 
Confucius  and  Lao  Tse,  all  the  trends  in 
■Chinese  philosophy  arose  .  .  .  In  India 
it  was  the  age  of  the  Upanishads  and  of 
Buddha;  as  in  China,  all  philosophical 
trends,  including  skepticism  and  ma- 
terialism, sophistry  and  nihilism,  were 

— Karl  Jaspers,  Way  to  Wisdom 

THE  PHRASE  "THE  AXIAL  AGE"  was  coined  by  the  German  existen- 
tialist philosopher  Karl  Jaspers.1  In  the  course  of  writing  a  history  of 
philosophy,  Jaspers  became  fascinated  by  the  fact  that  figures  like  Py- 
thagoras (570-495  bc),  the  Buddha  (563-483  bc),  and  Confucius  (551-479 
bc),  were  all  alive  at  exactly  the  same  time,  and  that  Greece,  India,  and 
China,  in  that  period,  all  saw  a  sudden  efflorescence  of  debate  between 
contending  intellectual  schools,  each  group  apparently,  unaware  of 
the  others'  existence.  Like  the  simultaneous  invention  of  coinage,  why 
this  happened  had  always  been  a  puzzle.  Jaspers  wasn't  entirely  sure 
himself.  To  some  extent,  he  suggested,  it  must  have  been  an  effect  of 
similar  historical  conditions.  For  most  of  the  great  urban  civilizations 
of  the  time,  the  early  Iron  Age  was  a  kind  of  pause  between  empires, 
a  time  when  political  landscapes  were  broken  into  a  checkerboard  of 
often  diminutive  kingdoms  and  city-states,  most  often  at  constant  war 
externally  and  locked  in  constant  political  debate  within.  Each  case 
witnessed  the  development  of  something  akin  to  a  drop-out  culture, 



with  ascetics  and  sages  fleeing  to  the  wilderness  or  wandering  from 
town  to  town  seeking  wisdom;  in  each,  too,  they  were  eventually  reab- 
sorbed into  the  political  order  as  a  new  kind  of  intellectual  or  spiritual 
elite,  whether  as  Greek  sophists,  Jewish  prophets,  Chinese  sages,  or 
Indian  holy  men. 

Whatever  the  reasons,  the  result,  Jaspers  argued,  was  the  first  pe- 
riod in  history  in  which  human  beings  applied  principles  of  reasoned 
inquiry  to  the  great  questions  of  human  existence.  He  observed  that  all 
these  great  regions  of  the  world,  China,  India,  and  the  Mediterranean, 
saw  the  emergence  of  remarkably  parallel  philosophical  trends,  from 
skepticism  to  idealism — in  fact,  almost  the  entire  range  of  positions 
about  the  nature  of  the  cosmos,  mind,  action,  and  the  ends  of  human 
existence  that  have  remained  the  stuff  of  philosophy  to  this  day.  As  one 
of  Jaspers'  disciples  later  put  it — overstating  only  slightly — "no  really 
new  ideas  have  been  added  since  that  time."2 

For  Jaspers,  the  period  begins  with  the  Persian  prophet  Zoroaster, 
around  800  bc,  and  ends  around  200  bc,  to  be  followed  by  a  Spiritual 
Age  that  centers  on  figures  like  Jesus  and  Mohammed.  For  my  own 
purposes,  I  find  it  more  useful  to  combine  the  two.  Let  us  define  the 
Axial  Age,  then,  as  running  from  800  bc  to  600  ad.3  This  makes  the 
Axial  Age  the  period  that  saw  the  birth  not  only  of  all  the  world's 
major  philosophical  tendencies,  but  also,  all  of  today's  major  world 
religions:  Zoroastrianism,  Prophetic  Judaism,  Buddhism,  Jainism,  Hin- 
duism, Confucianism,  Taoism,  Christianity,  and  Islam.4 

The  attentive  reader  may  have  noticed  that  the  core  period  of 
Jasper's  Axial  age — the  lifetimes  of  Pythagoras,  Confucius,  and  the 
Buddha — corresponds  almost  exactly  to  the  period  in  which  coinage 
was  invented.  What's  more,  the  three  parts  of  the  world  where  coins 
were  first  invented  were  also  the  very  parts  of  the  world  where  those 
sages  lived;  in  fact,  they  became  the  epicenters  of  Axial  Age  religious 
and  philosophical  creativity:  the  kingdoms  and  city-states  around  the 
Yellow  River  in  China,  the  Ganges  valley  in  northern  India,  and  the 
shores  of  the  Aegean  Sea. 

What  was  the  connection?  We  might  start  by  asking:  What  is  a 
coin?  The  normal  definition  is  that  a  coin  is  a  piece  of  valuable  metal, 
shaped  into  a  standardized  unit,  with  some  emblem  or  mark  inscribed 
to  authenticate  it.  The  world's  first  coins  appear  to  have  been  cre- 
ated within  the  kingdom  of  Lydia,  in  western  Anatolia  (now  Turkey), 
sometime  around  600  BC.5  These  first  Lydian  coins  were  basically  just 
round  lumps  of  electrum — a  gold-silver  alloy  that  occurred  naturally  in 
the  nearby  Pactolus  River — that  had  been  heated,  then  hammered  with 
some  kind  of  insignia.  The  very  first,  stamped  only  with  a  few  letters, 



appear  to  have  been  manufactured  by  ordinary  jewelers,  but  these  dis- 
appeared almost  instantly,  replaced  by  coins  manufactured  in  a  newly 
established  royal  mint.  Greek  cities  on  the  Anatolian  coast  soon  began 
to  strike  their  own  coins,  and  they  came  to  be  adopted  in  Greece  itself; 
the  same  thing  occurred  in  the  Persian  Empire  after  it  absorbed  Lydia 
in  547  bc. 

In  both  India  and  China,  we  can  observe  the  same  pattern:  invent- 
ed by  private  citizens,  coinage  was  quickly  monopolized  by  the  state. 
The  first  Indian  money,  which  seems  to  have  appeared  at  some  point 
in  the  sixth  century,  consisted  of  bars  of  silver  trimmed  down  to  uni- 
form weights,  then  punch-marked  with  some  kind  of  official  symbol.6 
Most  of  the  examples  discovered  by  archaeologists  contain  numerous 
additional  counter-punches,  presumably  added  much  in  the  way  that  a 
check  or  other  credit  instrument  is  endorsed  before  being  transferred. 
This  strongly  suggests  that  they  were  being  handled  by  people  used  to 
dealing  with  more  abstract  credit  instruments.7  Much  early  Chinese 
coinage  also  shows  signs  of  having  evolved  directly  from  social  curren- 
cies: some  were  in  fact  cast  bronze  in  the  shape  of  cowries,  though  oth- 
ers took  the  shape  of  diminutive  knives,  disks,  or  spades.  In  every  case, 
local  governments  quickly  stepped  in — presumably  within  the  space  of 
about  a  generation.8  However,  since  in  each  of  the  three  areas  there 
was  a  plethora  of  tiny  states,  this  meant  that  each  ended  up  with  a 
wide  variety  of  different  currency  systems.  For  example,  around  700  bc, 
northern  India  was  still  divided  into  Janapadas  or  "tribal  territories," 
some  of  them  monarchies  and  some  republics,  and  in  the  sixth  century 
there  were  still  at  least  sixteen  major  kingdoms.  In  China,  this  was  the 
period  where  the  old  Zhou  Empire  first  devolved  into  vying  principali- 
ties (the  "Spring  and  Autumn"  period,  722-481  bc),  then  splintered  into 
the  chaos  of  the  "Warring  States"  (475-221  bc.)  Like  the  Greek  city- 
states,  all  of  the  resulting  kingdoms,  no  matter  how  diminutive,  aspired 
to  issue  their  own  official  currency. 

Recent  scholarship  has  shed  a  great  deal  of  light  on  how  this  must 
have  happened.  Gold,  silver,  and  bronze — the  materials  from  which 
coins  were  made — had  long  been  the  media  of  international  trade;  but 
until  that  time,  only  the  rich  had  actually  had  much  in  their  possession. 
A  typical  Sumerian  farmer  may  well  have  never  had  occasion  to  hold  a 
substantial  piece  of  silver  in  his  hand,  except  perhaps  at  his  wedding. 
Most  precious  metals  took  the  form  of  wealthy  women's  anklets  and 
heirloom  chalices  presented  by  kings  to  their  retainers,  or  it  was  simply 
stockpiled  in  temples,  in  ingot  form,  as  sureties  for  loans.  Somehow, 
during  the  Axial  Age,  all  this  began  to  change.  Large  amounts  of  silver, 
gold,  and  copper  were  dethesaurized,  as  the  economic  historians  like 



to  say;  it  was  removed  from  the  temples  and  houses  of  the  rich  and 
placed  in  the  hands  of  ordinary  people,  was  broken  into  tinier  pieces, 
and  began  to  be  used  in  everyday  transactions. 

How?  Israeli  Classicist  David  Schaps  provides  the  most  plausible 
suggestion:  most  of  it  was  stolen.  This  was  a  period  of  generalized  war- 
fare, and  it  is  in  the  nature  of  war  that  precious  things  are  plundered. 

Soldiers  who  plunder  may  indeed  go  first  for  the  women,  the 
alcoholic  drinks,  or  the  food,  but  they  will  also  be  looking 
around  for  things  of  value  that  are  easily  portable.  A  long-term 
standing  army  will  tend  to  accumulate  many  things  that  are 
valuable  and  portable — and  the  most  valuable  and  portable 
items  are  precious  metals  and  precious  stones.  It  may  well  have 
been  the  protracted  wars  among  the  states  of  these  areas  that 
first  produced  a  large  population  of  people  with  precious  metal 
in  their  possession  and  a  need  for  everyday  necessities  .  .  . 

Where  there  are  people  who  want  to  buy  there  will  be  peo- 
ple willing  to  sell,  as  innumerable  tracts  on  black  markets, 
drug  dealing,  and  prostitution  point  out  .  .  .  The  constant 
warfare  of  the  archaic  age  of  Greece,  of  the  Janapadas  of  In- 
dia, of  the  Warring  States  of  China,  was  a  powerful  impetus 
for  the  development  of  market  trade,  and  in  particular  for 
market  trade  based  on  the  exchange  of  precious  metal,  usually 
in  small  amounts.  If  plunder  brought  precious  metal  into  the 
hands  of  the  soldiers,  the  market  will  have  spread  it  through 
the  population.9 

Now,  one  might  object:  but  surely,  war  and  plunder  were  noth- 
ing new.  The  Homeric  epics,  for  instance,  show  a  well-nigh  obsessive 
interest  in  the  division  of  the  spoils.  True,  but  what  the  Axial  Age  also 
saw — again,  equally  in  China,  India,  and  the  Aegean — was  the  rise  of 
a  new  kind  of  army,  made  up  not  of  aristocratic  warriors  and  their 
retainers,  but  trained  professionals.  The  period  when  the  Greeks  began 
to  use  coinage,  for  instance,  was  also  the  period  when  they  developed 
their  famous  phalanx  tactics,  which  required  constant  drill  and  training 
of  the  hoplite  soldiers.  The  results  were  so  extraordinarily  effective  that 
Greek  mercenaries  were  soon  being  sought  after  from  Egypt  to  Crimea. 
But  unlike  the  Homeric  retainers,  who  could  simply  be  ignored,  an 
army  of  trained  mercenaries  needs  to  be  rewarded  in  some  meaningful 
way.  One  could  perhaps  provide  them  all  with  livestock,  but  livestock 
are  hard  to  transport;  or  with  promissory  notes,  but  these  would  be 



worthless  in  the  mercenaries'  own  country.  Allowing  each  a  tiny  share 
of  the  plunder  does  seem  an  obvious  solution. 

These  new  armies  were,  directly  or  indirectly,  under  the  control  of 
governments,  and  it  took  governments  to  turn  these  chunks  of  metal 
into  genuine  currency.  The  main  reason  for  this  is  simply  scale:  to  cre- 
ate enough  coins  that  the  people  could  begin  to  use  them  in  everyday 
transactions  required  mass  production  on  a  scale  far  beyond  the  abili- 
ties of  local  merchants  or  smiths.10  Of  course  we  have  already  seen  why 
governments  might  have  incentive  to  do  so:  the  existence  of  markets 
was  highly  convenient  for  governments,  and  not  just  because  it  made  it 
so  much  easier  for  them  to  provision  large  standing  armies.  By  insist- 
ing that  only  their  own  coins  were  acceptable  as  fees,  fines,  or  taxes, 
governments  were  able  to  overwhelm  the  innumerable  social  currencies 
that  already  existed  in  their  hinterlands,  and  to  establish  something  like 
uniform  national  markets. 

Actually,  one  theory  is  that  the  very  first  Lydian  coins  were  in- 
vented explicitly  to  pay  mercenaries.11  This  might  help  explain  why 
the  Greeks,  who  supplied  most  of  the  mercenaries,  so  quickly  became 
accustomed  to  the  use  of  coins,  and  why  the  use  of  coinage  spread  so 
quickly  across  the  Hellenic  world,  so  that  by  480  bc  there  were  at  least 
one  hundred  mints  operating  in  different  Greek  cities,  even  though  at 
that  time,  none  of  the  great  trading  nations  of  the  Mediterranean  had 
as  yet  showed  the  slightest  interest  in  them.  The  Phoenicians,  for  exam- 
ple, were  considered  the  greatest  merchants  and  bankers  of  antiquity.12 
They  were  also  great  inventors,  having  been  the  first  to  develop  both 
the  alphabet  and  the  abacus.  Yet  for  centuries  after  the  invention  of 
coinage,  they  preferred  to  continue  conducting  business  as  they  always 
had,  with  unwrought  ingots  and  promissory  notes.13  Phoenician  cities 
struck  no  coins  until  365  bc,  and  while  Carthage,  the  great  Phoenician 
colony  in  North  Africa  that  came  to  dominate  commerce  in  the  West- 
ern Mediterranean,  did  so  a  bit  earlier,  it  was  only  when  "forced  to  do 
so  to  pay  Sicilian  mercenaries;  and  its  issues  were  marked  in  Punic,  'for 
the  people  of  the  camp."'14 

On  the  other  hand,  in  the  extraordinary  violence  of  the  Axial  Age, 
being  a  "great  trading  nation"  (rather  than,  say,  an  aggressive  military 
power  like  Persia,  Athens,  or  Rome)  was  not,  ultimately,  a  winning 
proposition.  The  fate  of  the  Phoenician  cities  is  instructive.  Sidon,  the 
wealthiest,  was  destroyed  by  the  Persian  emperor  Artaxerxes  III  after 
a  revolt  in  351  BC.  Forty  thousand  of  its  inhabitants  are  said  to  have 
committed  mass  suicide  rather  than  surrender.  Nineteen  years  later, 
Tyre  was  destroyed  after  a  prolonged  siege  by  Alexander:  ten  thousand 
died  in  battle,  and  the  thirty  thousand  survivors  were  sold  into  slavery. 



Carthage  lasted  longer,  but  when  Roman  armies  finally  destroyed  the 
city  in  146  bc,  hundreds  of  thousands  of  Carthaginians  were  said  to 
have  been  raped  and  slaughtered,  and  fifty  thousand  captives  put  on 
the  auction  block,  after  which  the  city  itself  was  razed  and  its  fields 
sowed  with  salt. 

All  this  may  bring  home  something  of  the  level  of  violence  amidst 
which  Axial  Age  thought  developed.15  But  it  also  leaves  us  asking: 
What  exactly  was  the  ongoing  relation  among  coinage,  military  power, 
and  this  unprecedented  outpouring  of  ideas? 

The  Mediterranean 

Here  again  our  best  information  is  from  the  Mediterranean  world, 
and  I  have  already  provided  some  of  its  outlines.  Comparing  Athens — 
with  its  far-flung  naval  empire — and  Rome,  we  can  immediately  detect 
striking  similarities.  In  each  city,  history  begins  with  a  series  of  debt 
crises.  In  Athens,  the  first  crisis,  the  one  that  culminated  in  Solon's 
reforms  of  594  bc,  was  so  early  that  coinage  could  hardly  have  been 
a  factor.  In  Rome,  too,  the  earliest  crises  seem  to  have  proceeded  the 
advent  of  currency.  Rather,  in  each  case,  coinage  became  a  solution. 
In  brief,  one  might  say  that  these  conflicts  over  debt  had  two  possible 
outcomes.  The  first  was  that  the  aristocrats  could  win,  and  the  poor 
remain  "slaves  of  the  rich" — which  in  practice  meant  that  most  people 
would  end  up  clients  of  some  wealthy  patron.  Such  states  were  gener- 
ally militarily  ineffective.16  The  second  was  that  popular  factions  could 
prevail,  institute  the  usual  popular  program  of  redistribution  of  lands 
and  safeguards  against  debt  peonage,  thus  creating  the  basis  for  a  class 
of  free  farmers  whose  children  would,  in  turn,  be  free  to  spend  much 
of  their  time  training  for  war.17 

Coinage  played  a  critical  role  in  maintaining  this  kind  of  free 
peasantry — secure  in  their  landholding,  not  tied  to  any  great  lord  by 
bonds  of  debt.  In  fact,  the  fiscal  policies  of  many  Greek  cities  amounted 
to  little  more  than  elaborate  systems  for  the  distribution  of  loot.  It's 
important  to  emphasize  that  few  ancient  cities,  if  any,  went  so  far  as 
to  outlaw  predatory  lending,  or  even  debt  peonage,  entirely.  Instead, 
they  threw  money  at  the  problem.  Gold,  and  especially  silver,  were  ac- 
quired in  war,  or  mined  by  slaves  captured  in  war.  Mints  were  located 
in  temples  (the  traditional  place  for  depositing  spoils),  and  city-states 
developed  endless  ways  to  distribute  coins,  not  only  to  soldiers,  sail- 
ors, and  those  producing  arms  or  outfitting  ships,  but  to  the  populace 



generally,  as  jury  fees,  fees  for  attending  public  assemblies,  or  some- 
times just  as  outright  distributions,  as  Athens  did  most  famously  when 
they  discovered  a  new  vein  of  silver  in  the  mines  at  Laurium  in  483  bc. 
At  the  same  time,  insisting  that  the  same  coins  served  as  legal  tender 
for  all  payments  due  to  the  state  guaranteed  that  they  would  be  in  suf- 
ficient demand  that  markets  would  soon  develop. 

Many  of  the  political  crises  in  ancient  Greek  cities  similarly  turned 
on  the  distribution  of  the  spoils.  Here  is  another  incident  recorded  in 
Aristotle,  who  provides  a  conservative  take  on  the  origins  of  a  coup 
in  the  city  of  Rhodes  around  391  bc  ("demagogues"  here  refers  to  the 
leaders  of  the  democracy): 

The  demagogues  needed  money  to  pay  the  people  for  attend- 
ing the  assembly  and  serving  on  juries;  for  if  the  people  did 
not  attend,  the  demagogues  would  lose  their  influence.  They 
raised  at  least  some  of  the  money  they  needed  by  preventing 
the  disbursement  of  the  money  due  the  trireme  [warship]  com- 
manders under  their  contracts  with  the  city  to  build  and  fit 
triremes  for  the  Rhodian  navy.  Since  the  trireme  commanders 
were  not  paid,  they  were  unable  in  turn  to  pay  their  suppliers 
and  workers,  who  sued  the  trireme  commanders.  To  escape 
these  lawsuits  the  trireme  commanders  banded  together  and 
overthrew  the  democracy.18 

It  was  slavery,  though,  that  made  all  this  possible.  As  the  figures 
concerning  Sidon,  Tyre,  and  Carthage  suggest,  enormous  numbers  of 
people  were  being  enslaved  in  many  of  these  conflicts,  and,  of  course, 
many  slaves  ended  up  working  in  the  mines,  producing  even  more  gold, 
silver,  and  copper.  (The  mines  in  Laurium  reportedly  employed  ten  to 
twenty  thousand  of  them.)19 

Geoffrey  Ingham  calls  the  resulting  system  a  "military-coinage 
complex" — though  I  think  it  would  be  more  accurate  to  call  it  a 
"military-coinage-slavery  complex."20  Anyway,  that  describes  rather 
nicely  how  it  worked  in  practice.  When  Alexander  set  out  to  conquer 
the  Persian  Empire,  he  borrowed  much  of  the  money  with  which  to  pay 
and  provision  his  troops,  and  he  minted  his  first  coins,  used  to  pay  his 
creditors  and  continue  to  support  the  money,  by  melting  down  gold  and 
silver  plundered  after  his  initial  victories.21  However,  an  expeditionary 
force  needed  to  be  paid,  and  paid  well:  Alexander's  army,  which  num- 
bered some  120,000  men,  required  half  a  ton  of  silver  a  day  just  for 
wages.  For  this  reason,  conquest  meant  that  the  existing  Persian  system 
of  mines  and  mints  had  to  be  reorganized  around  providing  for  the 



invading  army;  and  ancient  mines,  of  course,  were  worked  by  slaves.  In 
turn,  most  slaves  in  mines  were  war  captives.  Presumably  most  of  the 
unfortunate  survivors  of  the  siege  of  Tyre  ended  up  working  in  such 
mines.  One  can  see  how  this  process  might  feed  upon  itself.22 

Alexander  was  also  the  man  responsible  for  destroying  what  re- 
mained of  the  ancient  credit  systems,  since  not  only  the  Phoenicians 
but  also  the  old  Mesopotamian  heartland  had  resisted  the  new  coin 
economy.  His  armies  not  only  destroyed  Tyre;  they  also  dethesaurized 
the  gold  and  silver  reserves  of  Babylonian  and  Persian  temples,  the 
security  on  which  their  credit  systems  were  based,  and  insisted  that 
all  taxes  to  his  new  government  be  paid  in  his  own  money.  The  result 
was  to  "release  the  accumulated  specie  of  century  onto  the  market  in  a 
matter  of  months,"  something  like  180,000  talents,  or  in  contemporary 
terms,  an  estimated  $285  billion.23 

The  Hellenistic  successor  kingdoms  established  by  Alexander's  gen- 
erals, from  Greece  to  India,  employed  mercenaries  rather  than  national 
armies,  but  the  story  of  Rome  is,  again,  similar  to  that  of  Athens.  Its 
early  history,  as  recorded  by  official  chroniclers  like  Livy,  is  one  of 
continual  struggles  between  patricians  and  plebians,  and  of  continual 
crises  over  debt.  Periodically,  these  would  lead  to  what  were  called  mo- 
ments of  "the  secession  of  the  plebs,"  when  the  commoners  of  the  city 
abandoned  their  fields  and  workshops,  camped  outside  the  city,  and 
threatened  mass  defection — an  interesting  halfway  point  between  the 
popular  revolts  of  Greece  and  the  strategy  of  exodus  typically  pursued 
in  Egypt  and  Mesopotamia.  Here,  too,  the  patricians  were  ultimately 
faced  with  a  decision:  they  could  use  agricultural  loans  to  gradually 
turn  the  plebian  population  into  a  class  of  bonded  laborers  on  their 
estates,  or  they  could  accede  to  popular  demands  for  debt  protection, 
preserve  a  free  peasantry,  and  employ  the  younger  sons  of  free  farm 
families  as  soldiers.24  As  the  prolonged  history  of  crises,  secessions, 
and  reforms  makes  clear,  the  choice  was  made  grudgingly.25  The  plebs 
practically  had  to  force  the  senatorial  class  to  take  the  imperial  option. 
Still,  they  did,  and  over  time  they  gradually  presided  over  the  establish- 
ment of  a  welfare  system  that  recycled  at  least  a  share  of  the  spoils  to 
soldiers,  veterans,  and  their  families. 

It  seems  significant,  in  this  light,  that  the  traditional  date  of  the 
first  Roman  coinage — 338  BC — is  almost  exactly  the  date  when  debt 
bondage  was  finally  outlawed  (326  bc).26  Again,  coinage,  minted  from 
war  spoils,  didn't  cause  the  crisis.  It  was  used  as  a  solution. 

In  fact,  the  entire  Roman  empire,  at  its  height,  could  be  understood 
as  a  vast  machine  for  the  extraction  of  precious  metals  and  their  coin- 
ing and  distribution  to  the  military — combined  with  taxation  policies 



designed  to  encourage  conquered  populations  to  adopt  coins  in  their 
everyday  transactions.  Even  so,  for  most  of  its  history,  use  of  coins  was 
heavily  concentrated  in  two  regions:  in  Italy  and  a  few  major  cities, 
and  on  the  frontiers,  where  the  legions  were  actually  stationed.  In  areas 
where  there  were  neither  mines  nor  military  operations,  older  credit 
systems  presumably  continued  to  operate. 

I  will  add  one  final  note  here.  In  Greece  as  in  Rome,  attempts  to 
solve  the  debt  crisis  through  military  expansion  were  always,  ultimate- 
ly, just  ways  of  fending  off  the  problem — and  they  only  worked  for  a 
limited  period  of  time.  When  expansion  stopped,  everything  returned 
to  as  it  had  been  before.  Actually,  it's  not  clear  that  all  forms  of  debt 
bondage  were  ever  entirely  eliminated  even  in  cities  like  Athens  and 
Rome.  In  cities  that  were  not  successful  military  powers,  without  any 
source  of  income  to  set  up  welfare  policies,  debt  crises  continued  to 
flare  up  every  century  or  so — and  they  often  became  far  more  acute 
than  they  ever  had  in  the  Middle  East,  because  there  was  no  mecha- 
nism, short  of  outright  revolution,  to  declare  a  Mesopotamian-style 
clean  slate.  Large  populations,  even  in  the  Greek  world,  did,  in  fact, 
sink  to  the  rank  of  serfs  and  clients.27 

Athenians,  as  we've  seen,  seemed  to  assume  that  a  gentleman  nor- 
mally lived  a  step  or  two  ahead  of  his  creditors.  Roman  politicians 
were  little  different.  Of  course  much  of  the  debt  was  money  that  mem- 
bers of  the  senatorial  class  owed  to  each  other:  in  a  way,  it's  just  the 
usual  communism  of  the  rich,  extending  credit  to  one  another  on  easy 
terms  that  they  would  never  think  to  offer  others.  Still,  under  the  late 
Republic,  history  records  many  intrigues  and  conspiracies  hatched  by 
desperate  debtors,  often  aristocrats  driven  by  relentless  creditors  to 
make  common  cause  with  the  poor.28  If  we  hear  less  about  this  sort  of 
thing  happening  under  the  emperors,  it's  probably  because  there  were 
fewer  opportunities  for  protest;  what  evidence  we  have  suggests  that 
if  anything,  the  problem  got  much  worse.29  Around  100  ad,  Plutarch 
wrote  about  his  own  country  as  if  it  were  under  foreign  invasion: 

And  as  King  Darius  sent  to  the  city  of  Athens  his  lieutenants 
Datis  and  Artaphernes  with  chains  and  cords,  to  bind  the  pris- 
oners they  should  take;  so  these  usurers,  bringing  into  Greece 
boxes  full  of  schedules,  bills,  and  obligatory  contracts,  as  so 
many  irons  and  fetters  for  the  shackling  of  poor  criminals  .  .  . 

For  at  the  very  delivery  of  their  money,  they  immediately 
ask  it  back,  taking  it  up  at  the  same  moment  they  lay  it  down; 
and  they  let  out  that  again  to  interest  which  they  take  for  the 
use  of  what  they  have  before  lent. 



So  that  they  laugh  at  those  natural  philosophers  who  hold 
that  nothing  can  be  made  of  nothing  and  of  that  which  has  no 
existence;  but  with  them  usury  is  made  and  engendered  of  that 
which  neither  is  nor  ever  was.30 

The  works  of  the  early  Christian  fathers  likewise  resound  with 
endless  descriptions  of  the  misery  and  desperation  of  those  caught  in 
rich  lenders'  webs.  In  the  end,  through  this  means,  that  small  win- 
dow of  freedom  that  had  been  created  by  the  plebs  was  completely 
undone,  and  the  free  peasantry  largely  eliminated.  By  the  end  of  the 
empire,  most  people  in  the  countryside  who  weren't  outright  slaves 
had  become,  effectively,  debt  peons  to  some  rich  landlord;  a  situation 
in  the  end  legally  formalized  by  imperial  decrees  binding  peasants  to 
the  land.31  Without  a  free  peasantry  to  form  the  basis  for  the  army, 
the  state  was  forced  to  rely  more  and  more  on  arming  and  employing 
Germanic  barbarians  from  across  the  imperial  frontiers — with  results 
I  need  hardly  relate. 


In  most  ways,  India,  could  not  be  more  different  as  a  civilization  than 
the  ancient  Mediterranean — but  to  a  remarkable  degree,  the  same  basic 
pattern  repeats  itself  there  as  well. 

The  Bronze  Age  civilization  of  the  Indus  Valley  collapsed  sometime 
around  1600  BC;  it  would  be  about  a  thousand  years  before  India  saw 
the  emergence  of  another  urban  civilization.  When  it  did,  that  civili- 
zation was  centered  on  the  fertile  plains  that  surrounded  the  Ganges 
farther  east.  Here  too  we  observe,  at  first,  a  checkerboard  of  different 
sorts  of  government,  from  the  famous  "Ksatriya  republics"  with  a  pop- 
ulace in  arms  and  urban  democratic  assemblies,  to  elective  monarchies, 
to  centralized  empires  like  Kosala  and  Magadha.32  Both  Gautama  (the 
future  Buddha),  and  Mahavira  (the  founder  of  Jainism)  were  born  in 
one  of  the  republics,  though  both  ultimately  found  themselves  teaching 
within  the  great  empires,  whose  rulers  often  became  patrons  of  wan- 
dering ascetics  and  philosophers. 

Both  kingdoms  and  republics  produced  their  own  silver  and  cop- 
per coinage,  but  in  some  ways  the  republics  were  more  traditional, 
since  the  self-governing  "populace  in  arms"  consisted  of  the  traditional 
Ksatriya  or  warrior  caste,  who  typically  held  their  lands  in  common 
and  had  them  worked  by  serfs  or  slaves.33  The  kingdoms,  on  the  other 
hand,  were  founded  on  a  fundamentally  new  institution:  a  trained, 



professional  army,  open  to  young  men  of  a  wide  variety  of  back- 
grounds, their  equipment  supplied  by  central  authorities  (soldiers  were 
obliged  to  check  their  arms  and  armor  when  they  entered  cities),  and 
provided  with  generous  salaries. 

Whatever  their  origins,  here  too,  coins  and  markets  sprung  up 
above  all  to  feed  the  machinery  of  war.  Magadha,  which  ultimately 
came  out  on  top,  did  so  largely  because  it  controlled  most  of  the 
mines.  Kautilya's  Arthasastra,  a  political  treatise  written  by  one  of  the 
chief  ministers  for  the  Mauryan  dynasty  that  succeeded  it  (321-185  bc), 
stated  the  matter  precisely:  "The  treasury  is  based  upon  mining,  the 
army  upon  the  treasury;  he  who  has  army  and  treasury  may  conquer 
the  whole  wide  earth.'"4  The  government  drew  its  personnel  first  of 
all  from  a  landed  class,  which  provided  trained  administrators,  but 
even  more,  full-time  soldiers:  the  salaries  of  each  rank  of  soldier  and 
administrator  were  carefully  stipulated.  These  armies  could  be  huge. 
Greek  sources  report  that  Magadha  could  put  to  the  field  a  force  of 
200,000  infantry,  20,000  horses,  and  about  4,000  elephants — and  that 
Alexander's  men  mutinied  rather  than  have  to  face  them.  Whether  on 
campaign  or  in  garrison,  they  were  inevitably  accompanied  by  a  range 
of  different  sorts  of  camp  followers — petty  traders,  prostitutes,  and 
hired  servants — which,  with  the  soldiers,  seems  to  have  been  the  very 
medium  through  which  a  cash  economy  had  originally  taken  form.35 
By  Kautilya's  time,  a  few  hundred  years  later,  the  state  was  inserting 
itself  into  every  aspect  of  the  process:  Kautilya  suggests  paying  sol- 
diers apparently  generous  wages,  then  secretly  replacing  hawkers  with 
government  agents  who  could  charge  them  twice  the  normal  rates  for 
supplies,  as  well  as  organizing  prostitutes  under  a  ministry  in  which 
they  could  be  trained  as  spies,  so  as  to  make  detailed  reports  on  their 
clients'  loyalties. 

Thus  was  the  market  economy,  born  of  war,  gradually  taken  over 
by  the  government.  Rather  than  stifle  the  spread  of  currency,  the  pro- 
cess seems  to  have  doubled  and  even  tripled  it:  the  military  logic  was 
extended  to  the  entire  economy,  the  government  systematically  setting 
up  its  granaries,  workshops,  trading  houses,  warehouses,  and  jails, 
staffed  by  salaried  officials,  and  all  selling  products  on  the  market  so  as 
to  collect  the  pieces  of  silver  paid  off  to  soldiers  and  officials  and  put 
them  back  into  the  royal  treasuries  again.'6  The  result  was  a  moneta- 
rization  of  daily  life  unlike  anything  India  was  to  see  for  another  two 
thousand  years.'7 

Something  similar  seems  to  have  happened  with  slavery,  which  was 
quite  commonplace  at  the  time  of  the  rise  of  the  great  armies — again, 
unlike  almost  any  other  point  in  Indian  history — but  was  gradually 



brought  under  government  control.38  By  Kautilya's  time,  most  war  cap- 
tives were  not  sold  in  marketplaces  but  relocated  to  government  vil- 
lages on  newly  reclaimed  land.  They  were  not  allowed  to  leave,  and 
these  government  villages  were,  at  least  according  to  the  regulations, 
remarkably  dreary  places:  veritable  work  camps,  with  all  forms  of 
festive  entertainment  officially  prohibited.  Slave  hirelings  were  mostly 
convicts,  rented  by  the  state  during  their  terms. 

With  their  armies,  spies,  and  administration  controlling  everything, 
the  new  Indian  kings  evinced  little  interest  in  the  old  priestly  caste 
and  its  Vedic  ritual,  though  many  kept  up  a  lively  interest  in  the  new 
philosophical  and  religious  ideas  that  seem  to  have  been  cropping  up 
everywhere  at  the  time.  As  time  went  on,  however,  the  war  machine 
began  to  sputter.  It's  not  clear  exactly  why  this  happened.  By  the 
time  of  emperor  Asoka  (273-232  be),  the  Maury  an  dynasty  controlled 
almost  all  of  present-day  India  and  Pakistan,  but  the  Indian  version 
of  the  military-coinage-slavery  complex  was  showing  definite  signs  of 
strain.  Perhaps  the  clearest  sign  was  the  debasement  of  the  coinage, 
which  over  the  course  of  two  centuries  or  so  had  gone  from  almost 
pure  silver  to  about  fifty  percent  copper.39 

Asoka,  famously,  began  his  reign  in  conquest:  in  265  be,  destroying 
the  Kalingas,  one  of  the  last  remaining  Indian  republics,  in  a  war  in 
which  hundreds  of  thousands  of  human  beings  were,  according  to  his 
own  account,  killed  or  carried  off  into  slavery.  Asoka  later  claimed  to 
have  been  so  disturbed  and  haunted  by  the  carnage  that  he  renounced 
war  altogether,  embraced  Buddhism,  and  declared  that  from  that  time 
on,  his  kingdom  would  be  governed  by  principles  of  ahimsa,  or  non- 
violence. "Here  in  my  kingdom,"  he  declared  in  an  edict  inscribed  on 
one  of  the  great  granite  pillars  in  his  capital  of  Patna,  which  so  dazzled 
the  Greek  ambassador  Megasthenes,  "no  living  being  must  be  killed  or 
sacrificed."40  Such  a  statement  obviously  can't  be  taken  literally:  Asoka 
might  have  replaced  sacrificial  ritual  with  vegetarian  feasts,  but  he 
didn't  abolish  the  army,  abandon  capital  punishment,  or  even  outlaw 
slavery.  But  his  rule  marked  a  revolutionary  shift  in  ethos.  Aggressive 
war  was  abandoned,  and  much  of  the  army  does  seems  to  have  been 
demobilized,  along  with  the  network  of  spies  and  state  bureaucrats, 
with  the  new,  proliferating  mendicant  orders  (Buddhists,  Jains,  and 
also  world-renouncing  Hindus)  given  official  state  support  to  preach  to 
the  villages  on  questions  of  social  morality.  Asoka  and  his  successors 
diverted  substantial  resources  to  these  religious  orders,  with  the  result 
that,  over  the  next  centuries,  thousands  of  stupas  and  monasteries  were 
built  across  the  subcontinent.41 



Asoka's  reforms  are  useful  to  contemplate  here  because  they  help 
reveal  just  how  mistaken  some  of  our  basic  assumptions  are:  par- 
ticularly, that  money  equals  coins,  and  that  more  coins  in  circulation 
means  more  commerce  and  a  greater  role  for  private  merchants.  In 
reality,  the  Magadha  state  promoted  markets  but  had  been  suspicious 
of  private  merchants,  seeing  them  largely  as  competitors.42  Merchants 
had  been  among  the  earliest  and  most  ardent  supporters  of  the  new 
religions  (Jains,  owing  to  their  rigorous  enforcement  of  rules  against 
harm  to  any  living  creature,  were  obliged  to  become,  effectively,  a 
mercantile  caste).  Mercantile  interests  fully  supported  Asoka's  reforms. 
Yet  the  result  was  not  an  increase  in  the  use  of  cash  in  everyday  affairs 
but  exactly  the  opposite. 

Early  Buddhist  economic  attitudes  have  long  been  considered  a 
bit  mysterious.  On  the  one  hand,  monks  could  not  own  property  as 
individuals;  they  were  expected  to  live  an  austere  communistic  life 
with  little  more  than  a  robe  and  begging  bowl  as  personal  possessions, 
and  they  were  strictly  forbidden  to  so  much  as  touch  anything  made 
of  gold  or  silver.  On  the  other  hand,  however  suspicious  of  precious 
metals,  Buddhism  had  always  had  a  liberal  attitude  toward  credit  ar- 
rangements. It  is  one  of  the  few  of  the  great  world  religions  that  has 
never  formally  condemned  usury.43  Taken  in  the  context  of  the  times, 
however,  there's  nothing  particularly  mysterious  about  any  of  this.  It 
makes  perfect  sense  for  a  religious  movement  that  rejected  violence 
and  militarism,  but  that  was  in  no  way  opposed  to  commerce.44  As  we 
shall  see,  while  Asoka's  own  empire  was  not  long  to  endure,  soon  to 
be  replaced  by  a  succession  of  ever  weaker  and  mostly  smaller  states, 
Buddhism  took  root.  The  decline  of  the  great  armies  eventually  led  to 
the  near-disappearance  of  coinage,  but  also  to  a  veritable  efflorescence 
of  increasingly  sophisticated  forms  of  credit. 


Until  about  475  BC,  northern  China  was  still  nominally  an  empire,  but 
the  emperors  had  devolved  into  figureheads  and  a  series  of  de  facto 
kingdoms  had  emerged.  The  period  from  475  to  221  bc  is  referred  as 
the  "Warring  States  period";  at  that  point,  even  the  pretense  of  unity 
was  cast  aside.  Ultimately,  the  country  was  reunited  by  the  state  of 
Qin,  who  established  a  dynasty  that  was  then  immediately  overthrown 
by  a  series  of  massive  popular  insurrections,  ushering  in  the  Han  dy- 
nasty (206  BC-220  ad),  founded  by  a  previously  obscure  rural  constable 



and  peasant  leader  named  Liu  Bao,  who  was  the  first  Chinese  leader 
to  adopt  the  Confucian  ideology,  exam  system,  and  pattern  of  civil 
administration  that  were  to  continue  for  almost  two  thousand  years. 

Still,  the  golden  age  of  Chinese  philosophy  was  the  period  of  chaos 
that  preceded  unification,  and  this  followed  the  typical  Axial  Age  pat- 
tern: the  same  fractured  political  landscape,  the  same  rise  of  trained, 
professional  armies  and  the  creation  of  coined  money  largely  in  order 
to  pay  them.45  We  also  see  the  same  government  policies  designed  to 
encourage  the  development  of  markets,  chattel  slavery  on  a  scale  not 
seen  before  or  since  in  Chinese  history,  the  appearance  of  itinerant 
philosophers  and  religious  visionaries,  battling  intellectual  schools,  and 
eventually,  attempts  by  political  leaders  to  transform  the  new  philoso- 
phies into  religions  of  state.46 

There  were  also  significant  differences,  starting  with  the  currency 
system.  China  never  minted  gold  or  silver  coins.  Merchants  used  pre- 
cious metals  in  the  form  of  bullion,  but  the  coins  in  actual  circulation 
were  basically  small  change:  cast  bronze  disks,  usually  with  a  hole  in 
the  middle  so  that  they  could  be  strung  together.  Such  strings  of  "cash" 
were  produced  in  extraordinary  numbers,  and  very  large  amounts  had 
to  be  assembled  for  large-scale  transactions:  when  wealthy  men  wished 
to  make  donations  to  temples,  for  instance,  they  had  to  use  oxcarts 
to  carry  the  money.  The  most  plausible  explanation  is  that,  especially 
after  unification,  Chinese  armies  were  enormous — some  Warring  States 
armies  numbered  up  to  a  million — but  not  nearly  as  professional  or 
well  paid  as  those  of  kingdoms  farther  west,  and  from  Qin  and  Han 
times  on,  rulers  were  careful  to  ensure  that  this  remained  the  case,  to 
make  sure  the  army  never  became  an  independent  power  base.47 

There  was  also  a  notable  difference  in  that  the  new  religious  and 
philosophical  movements  in  China  were  from  their  very  beginnings  also 
social  movements.  Elsewhere,  they  only  gradually  became  so.  In  ancient 
Greece,  philosophy  began  with  cosmological  speculation;  philosophers 
were  more  likely  to  be  individual  sages,  perhaps  surrounded  by  a  few 
ardent  disciples,  as  founders  of  movements.48  Under  the  Roman  empire, 
schools  of  philosophy  like  the  Stoics,  Epicureans,  Neo-Platonists  did 
become  movements  of  a  sort:  at  least  in  the  sense  that  they  had  thou- 
sands of  educated  adherents,  who  "practiced"  philosophy  not  only  by 
reading,  writing,  and  debating,  but  even  more  by  meditation,  diet,  and 
exercise.  Still,  philosophical  movements  were  basically  confined  to  the 
civic  elite;  it  was  only  with  the  rise  of  Christianity  and  other  religious 
movements  that  philosophy  moved  beyond  it.49  One  can  observe  a 
similar  evolution  in  India,  from  individual  Brahman  world-renouncers, 
forest  sages,  and  wandering  mendicants  with  theories  about  the  nature 



of  the  soul  or  the  composition  of  the  material  universe;  to  philosoph- 
ical movements  of  the  Buddhists,  Jains,  AjTvika,  and  others  mostly 
long  forgotten;  to,  finally,  mass  religious  movements  with  thousands  of 
monks,  shrines,  schools,  and  networks  of  lay  supporters. 

In  China,  while  many  of  the  founders  of  the  "hundred  schools"  of 
philosophy  that  blossomed  under  the  Warring  States  were  wandering 
sages  who  spent  their  days  moving  from  city  to  city  trying  to  catch 
the  ears  of  princes,  others  were  leaders  of  social  movements  from  the 
very  start.  Some  of  these  movements  didn't  even  have  leaders,  like  the 
School  of  the  Tillers,  an  anarchist  movement  of  peasant  intellectuals 
who  set  out  to  create  egalitarian  communities  in  the  cracks  and  fissures 
between  states.50  The  Mohists,  egalitarian  rationalists  whose  social 
base  seems  to  have  been  urban  artisans,  not  only  were  philosophically 
opposed  to  war  and  militarism,  but  organized  battalions  of  military  en- 
gineers who  would  actively  discourage  conflicts  by  volunteering  to  fight 
in  any  war  against  the  side  of  the  aggressor.  Even  the  Confucians,  for 
all  the  importance  they  attached  to  courtly  ritual,  were  in  their  early 
days  mainly  known  for  their  efforts  in  popular  education.51 

Materialism  I: 
The  Pursuit  of  Profit 

What  is  one  to  make  of  all  this?  The  popular  education  campaigns  of 
the  period  perhaps  provide  a  clue.  The  Axial  Age  was  the  first  time 
in  human  history  when  familiarity  with  the  written  word  was  no  lon- 
ger limited  to  priests,  administrators,  and  merchants,  but  had  become 
necessary  to  full  participation  in  civic  life.  In  Athens,  it  was  taken  for 
granted  that  only  a  country  bumpkin  would  be  entirely  illiterate. 

Without  mass  literacy,  neither  the  emergence  of  mass  intellectual 
movements,  nor  the  spread  of  Axial  Age  ideas  would  have  been  pos- 
sible. By  the  end  of  the  period,  these  ideas  had  produced  a  world  where 
even  the  leaders  of  barbarian  armies  descending  on  the  Roman  empire 
felt  obliged  to  take  a  position  on  the  question  of  the  Mystery  of  the 
Trinity,  and  where  Chinese  monks  could  spend  time  debating  the  rela- 
tive merits  of  the  eighteen  schools  of  Classical  Indian  Buddhism. 

No  doubt  the  growth  of  markets  played  a  role  too,  not  only  help- 
ing to  free  people  from  the  proverbial  shackles  of  status  or  community, 
but  encouraging  a  certain  habit  of  rational  calculation,  of  measuring 
inputs  and  outputs,  means  and  ends,  all  of  which  must  inevitably  have 
found  some  echoes  in  the  new  spirit  of  rational  inquiry  that  begins  to 



appear  in  all  the  same  times  and  places.  Even  the  word  "rational"  is 
telling:  it  derives,  of  course,  from  "ratio" — how  many  of  X  go  into 
Y — a  sort  of  mathematical  calculation  previously  used  mainly  by  ar- 
chitects and  engineers,  but  which,  with  the  rise  of  markets,  everyone 
who  didn't  want  to  get  cheated  at  the  marketplace  had  to  learn  how 
to  do.  Still,  we  must  be  careful  here.  After  all,  money  in  itself  was 
nothing  new.  Sumerian  farmers  and  tradesmen  were  already  perfectly 
capable  of  making  such  calculations  in  3500  bc;  but  none,  as  far  as  we 
know,  were  so  impressed  that  they  concluded,  like  Pythagoras,  that 
mathematical  ratios  were  the  key  to  understanding  the  nature  of  the 
universe  and  the  movement  of  celestial  bodies,  and  that  all  things  were 
ultimately  composed  of  numbers — and  they  certainly  hadn't  formed 
secret  societies  based  on  sharing  this  understanding,  debating  and  purg- 
ing and  excommunicating  one  another.52 

To  understand  what  had  changed,  we  have  to  look,  again,  at  the 
particular  kind  of  markets  that  were  emerging  at  the  beginning  of  the 
Axial  Age:  impersonal  markets,  born  of  war,  in  which  it  was  possible 
to  treat  even  neighbors  as  if  they  were  strangers. 

Within  human  economies,  motives  are  assumed  to  be  complex. 
When  a  lord  gives  a  gift  to  a  retainer,  there  is  no  reason  to  doubt  that 
it  is  inspired  by  a  genuine  desire  to  benefit  that  retainer,  even  if  it  is 
also  a  strategic  move  designed  to  ensure  loyalty,  and  an  act  of  magnifi- 
cence meant  to  remind  everyone  else  that  he  is  great  and  the  retainer 
small.  There  is  no  sense  of  contradiction  here.  Similarly,  gifts  between 
equals  are  usually  fraught  with  many  layers  of  love,  envy,  pride,  spite, 
communal  solidarity,  or  any  of  a  dozen  other  things.  Speculating  on 
such  matters  is  a  major  form  of  daily  entertainment.  What's  missing, 
though,  is  any  sense  that  the  most  selfish  ("self-interested")  motive  is 
necessarily  the  real  one:  those  speculating  on  hidden  motives  are  just 
as  likely  to  assume  that  someone  is  secretly  trying  to  help  a  friend  or 
harm  an  enemy  as  to  acquire  some  advantage  for  him-  or  herself.53 
Neither  is  any  of  this  likely  to  have  changed  much  in  the  rise  of  early 
credit  markets,  where  the  value  of  an  IOU  was  as  much  dependent  on 
assessments  of  its  issuer's  character  as  on  his  disposable  income,  and 
motives  of  love,  envy,  pride,  etc.  could  never  be  completely  set  aside. 

Cash  transactions  between  strangers  were  different,  and  all  the 
more  so  when  trading  is  set  against  a  background  of  war  and  emerges 
from  disposing  of  loot  and  provisioning  soldiers;  when  one  often  had 
best  not  ask  where  the  objects  traded  came  from,  and  where  no  one 
is  much  interested  in  forming  ongoing  personal  relationships  anyway. 
Here,  transactions  really  do  become  simply  a  figuring-out  of  how  many 
of  X  will  go  for  how  many  of  Y,  of  calculating  proportions,  estimating 



quality,  and  trying  to  get  the  best  deal  for  oneself.  The  result,  during 
the  Axial  Age,  was  a  new  way  of  thinking  about  human  motivation,  a 
radical  simplification  of  motives  that  made  it  possible  to  begin  speak- 
ing of  concepts  like  "profit"  and  "advantage" — and  imagining  that  this 
is  what  people  are  really  pursuing,  in  every  aspect  of  existence,  as  if 
the  violence  of  war  or  the  impersonality  of  the  marketplace  has  simply 
allowed  them  to  drop  the  pretense  that  they  ever  cared  about  anything 
else.  It  was  this,  in  turn,  that  allowed  human  life  to  seem  like  it  could 
be  reduced  to  a  matter  of  means-to-end  calculation,  and  hence  some- 
thing that  could  be  examined  using  the  same  means  that  one  used  to 
study  the  attraction  and  repulsion  of  celestial  bodies.54  If  the  underlying 
assumption  very  much  resembles  those  of  contemporary  economists, 
it's  no  coincidence — but  with  the  difference  that,  in  an  age  when  mon- 
ey, markets,  states,  and  military  affairs  were  all  intrinsically  connected, 
money  was  needed  to  pay  armies  to  capture  slaves  to  mine  gold  to 
produce  money;  when  "cutthroat  competition"  often  did  involve  the 
literal  cutting  of  throats,  it  never  occurred  to  anyone  to  imagine  that 
selfish  ends  could  be  pursued  by  peaceful  means.  Certainly,  this  picture 
of  humanity  does  begin  to  appear,  with  startling  consistency,  across 
Eurasia,  wherever  we  also  see  coinage  and  philosophy  appear. 

China  provides  an  unusually  transparent  case  in  point.  Already 
in  Confucius's  time,  Chinese  thinkers  were  speaking  of  the  pursuit  of 
profit  as  the  driving  force  in  human  life.  The  actual  term  used  was  //', 
a  word  first  used  to  refer  to  the  increase  of  grain  one  harvests  from 
a  field  over  and  above  what  one  originally  planted  (the  pictogram 
represents  a  sheaf  of  wheat  next  to  a  knife).55  From  there  it  came  to 
mean  commercial  profit,  and  thence,  a  general  term  for  "benefit"  or 
"payback."  The  following  story,  which  purports  to  tell  the  reaction  of 
a  merchant's  son  named  Lii  Buwei  on  learning  that  an  exiled  prince 
was  living  nearby,  illustrates  the  progression  nicely: 

On  returning  home,  he  said  to  his  father,  "What  is  the  profit  on 
investment  that  one  can  expect  from  plowing  fields?" 

"Ten  times  the  investment,"  replied  his  father. 

"And  the  return  on  investment  in  pearls  and  jades  is  how 

"A  hundredfold." 

"And  the  return  on  investment  from  establishing  a  ruler  and 
securing  the  state  would  be  how  much?" 
"It  would  be  incalculable."56 



Lii  adopted  the  prince's  cause  and  eventually  contrived  to  make 
him  King  of  Qin.  He  went  on  to  became  first  minister  for  the  king's 
son,  Qin  Shi  Huang,  helping  him  defeat  the  other  Warring  States  to 
became  the  first  Emperor  of  China.  We  still  have  a  compendium  of 
political  wisdom  that  Lii  commissioned  for  the  new  emperor,  which 
contains  such  military  advice  as  the  following: 

As  a  general  principle,  when  an  enemy's  army  comes,  it  seeks 
some  profit.  Now  if  they  come  and  find  the  prospect  of  death 
instead,  they  will  consider  running  away  the  most  profitable 
thing  to  do.  When  all  one's  enemies  consider  running  to  be  the 
most  profitable  thing  to  do,  no  blades  will  cross. 

This  is  the  most  essential  point  in  military  matters.57 

In  such  a  world,  heroic  considerations  of  honor  and  glory,  vows  to 
gods  or  desire  for  vengeance,  were  at  best  weaknesses  to  be  manipu- 
lated. In  the  numerous  manuals  on  statecraft  produced  at  the  time, 
everything  was  cast  as  a  matter  of  recognizing  interest  and  advantage, 
calculating  how  to  balance  that  which  will  profit  the  ruler  against  that 
which  will  profit  the  people,  determining  when  the  ruler's  interests  are 
the  same  as  the  people's  and  when  they  contradict.58  Technical  terms 
drawn  from  politics,  economics,  and  military  strategy  ("return  on  in- 
vestment," "strategic  advantage")  blended  and  overlapped. 

The  predominant  school  of  political  thought  under  the  Warring 
States  was  that  of  the  Legalists,  who  insisted  that  in  matters  of  state- 
craft, a  ruler's  interests  were  the  only  consideration,  even  if  rulers 
would  be  unwise  to  admit  this.  Still,  the  people  could  be  easily  ma- 
nipulated, since  they  had  the  same  motivations:  the  people's  pursuit  of 
profit,  wrote  Lord  Shang,  is  utterly  predictable,  "just  like  the  tendency 
of  water  to  flow  downhill."59  Shang  was  harsher  than  most  of  his  fel- 
low Legalists  in  that  he  believed  that  widespread  prosperity  would 
ultimately  harm  the  ruler's  ability  to  mobilize  his  people  for  war,  and 
therefore  that  terror  was  the  most  efficient  instrument  of  governance, 
but  even  he  insisted  that  this  regime  be  clothed  as  a  regime  of  law 
and  justice. 

Wherever  the  military-coinage-slavery  complex  began  to  take  hold, 
we  find  political  theorists  propounding  similar  ideas.  Kautilya  was  no 
different:  the  title  of  his  book,  the  Arthasastra,  is  usually  translated  as 
"manual  of  statecraft,"  since  it  consists  of  advice  to  rulers,  but  its  more 
literal  translation  is  "the  science  of  material  gain."60  Like  the  Legalists, 
Kautilya  emphasized  the  need  to  create  a  pretext  that  governance  was  a 
matter  of  morality  and  justice,  but  in  addressing  the  rulers  themselves, 



he  insisted  that  "war  and  peace  are  considered  solely  from  the  point  of 
view  of  profit" — of  amassing  wealth  to  create  a  more  effective  army, 
of  using  the  army  to  dominate  markets  and  control  resources  to  amass 
more  wealth,  and  so  on.61  In  Greece  we've  already  met  Thrasyma- 
chos.  True,  Greece  was  slightly  different.  Greek  city-states  did  not  have 
kings,  and  the  collapse  of  private  interests  and  affairs  of  state  was  in 
principle  universally  denounced  as  tyranny.  Still,  in  practice,  what  this 
meant  was  that  city-states,  and  even  political  factions,  ended  up  acting 
in  precisely  the  same  coldly  calculating  way  as  Indian  or  Chinese  sov- 
ereigns. Anyone  who  has  ever  read  Thucydides'  Melian  dialogue — in 
which  Athenian  generals  present  the  population  of  a  previously  friendly 
city  with  elegantly  reasoned  arguments  for  why  the  Athenians  have 
determined  that  it  is  to  the  advantage  of  their  empire  to  threaten  them 
with  collective  massacre  if  they  are  not  willing  to  become  tribute- 
paying  subjects,  and  why  it  is  equally  in  the  interests  of  the  Melians  to 
submit — is  aware  of  the  results.62 

Another  striking  feature  of  this  literature  is  its  resolute  material- 
ism. Goddesses  and  gods,  magic  and  oracles,  sacrificial  ritual,  ancestral 
cults,  even  caste  and  ritual  status  systems  all  either  disappear  or  are 
sidelined,  no  longer  treated  as  ends  in  themselves  but  as  yet  mere  tools 
to  be  used  for  the  pursuit  of  material  gain. 

That  intellectuals  willing  to  produce  such  theories  should  win  the 
ears  of  princes  is  hardly  surprising.  Neither  is  it  particularly  surpris- 
ing that  other  intellectuals  should  have  been  so  offended  by  this  sort 
of  cynicism  that  they  began  to  make  common  cause  with  the  popular 
movements  that  inevitably  began  to  form  against  those  princes.  But 
as  is  so  often  the  case,  oppositional  intellectuals  were  faced  with  two 
choices:  either  adopt  the  reigning  terms  of  debate,  or  try  to  come  up 
with  a  diametrical  inversion.  Mo  Di,  the  founder  of  Mohism,  took  the 
first  approach.  He  turned  the  concept  of  li,  profit,  into  something  more 
like  "social  utility,"  and  then  he  attempted  to  demonstrate  that  war 
itself  is,  by  definition,  an  unprofitable  activity.  For  example,  he  wrote, 
campaigns  can  only  be  fought  in  spring  and  autumn,  and  each  had 
equally  deleterious  effects: 

If  in  the  spring  then  the  people  miss  their  sowing  and  planting, 
if  in  the  autumn,  they  miss  their  reaping  and  harvesting.  Even  if 
they  miss  only  one  season,  then  the  number  of  people  who  will 
die  of  cold  and  hunger  is  incalculable.  Now  let  us  calculate  the 
army's  equipment,  the  arrows,  standards,  tents,  armor,  shields, 
and  sword  hilts;  the  number  of  these  which  will  break  and  per- 
ish and  not  come  back  ...  So  also  with  oxen  and  horses  .  .  ,63 



His  conclusion:  if  one  could  add  up  the  total  costs  of  aggression  in 
human  lives,  animal  lives,  and  material  damage,  one  would  be  forced 
to  the  conclusion  that  they  never  outweighed  the  benefits — even  for  the 
victor.  In  fact,  Mo  Di  took  this  sort  of  logic  so  far  that  he  ended  up  ar- 
guing that  the  only  way  to  optimize  the  overall  profit  of  humanity  was 
to  abandon  the  pursuit  of  private  profit  entirely  and  adopt  a  principle 
of  what  he  called  "universal  love" — essentially  arguing  that  if  one  takes 
the  principle  of  market  exchange  to  its  logical  conclusion,  it  can  only 
lead  to  a  kind  of  communism. 

The  Confucians  took  the  opposite  approach,  rejecting  the  initial 
premise.  A  good  example  is  most  of  the  opening  of  Mencius'  much- 
remembered  conversation  with  King  Hui: 

"Venerable  Sir,"  the  King  greeted  him,  "since  you  have  not 
counted  a  thousand  miles  too  far  to  come  here,  may  I  suppose 
that  you  also  have  something  with  which  you  may  profit  my 

Mencius  replied: 

"Why  must  Your  Majesty  necessarily  use  this  word  'profit'? 
What  I  have  are  only  these  two  topics:  benevolence  and  righ- 
teousness, and  nothing  else."64 

Still,  the  end-point  was  roughly  the  same.  The  Confucian  ideal  of 
ren,  of  humane  benevolence,  was  basically  just  a  more  complete  inver- 
sion of  profit-seeking  calculation  than  Mo  Di's  universal  love;  the  main 
difference  was  that  the  Confucians  added  a  certain  aversion  to  calcula- 
tion itself,  preferring  what  might  almost  be  called  an  art  of  decency. 
Taoists  were  later  to  take  this  even  further  with  their  embrace  of  intu- 
ition and  spontaneity.  All  were  so  many  attempts  to  provide  a  mirror 
image  of  market  logic.  Still,  a  mirror  image  is,  ultimately,  just  that:  the 
same  thing,  only  backwards.  Before  long  we  end  up  with  an  endless 
maze  of  paired  opposites — egoism  versus  altruism,  profit  versus  char- 
ity, materialism  versus  idealism,  calculation  versus  spontaneity — none 
of  which  could  ever  have  been  imagined  except  by  someone  starting 
out  from  pure,  calculating,  self-interested  market  transactions.65 



Materialism  II: 

As  in  the  near  presence  of  death,  de- 
spise poor  flesh,  this  refuse  of  blood  and 
bones,  this  web  and  tissue  of  nerves  and 
veins  and  arteries. 

— Marcus  Aurelius,  Meditations  2.2 

Taking  pity  on  the  hungry  wolf,  Wen- 
shuang  announced,  "I  do  not  covet  this 
filthy  bag  of  meat.  I  give  it  over  to  you 
that  I  may  quickly  acquire  a  body  of 
more  enduring  strength.  This  donation 
will  help  benefit  us  both." 

— Discourse  on  the  Pure  Land  21.12 

As  I've  already  observed,  China  was  unusual  because  philosophy  there 
began  with  debates  about  ethics  and  only  later  turned  to  speculations 
about  the  nature  of  the  cosmos.  In  both  Greece  and  India,  cosmological 
speculation  came  first.  In  each,  too,  questions  about  the  nature  of  the 
physical  universe  quickly  give  way  to  speculation  about  mind,  truth, 
consciousness,  meaning,  language,  illusion,  world-spirits,  cosmic  intel- 
ligence, and  the  fate  of  the  human  soul. 

This  particular  maze  of  mirrors  is  so  complex  and  dazzling  that 
it's  extraordinarily  difficult  to  discern  the  starting  point — that  is,  what, 
precisely,  is  being  reflected  back  and  forth.  Here  anthropology  can  be 
helpful,  as  anthropologists  have  the  unique  advantage  of  being  able  to 
observe  how  human  beings  who  have  not  previously  been  part  of  these 
conversations  react  when  first  exposed  to  Axial  Age  concepts.  Every 
now  and  then  too,  we  are  presented  with  moments  of  exceptional 
clarity:  ones  that  reveal  the  essence  of  our  own  thought  to  be  almost 
exactly  the  opposite  of  what  we  thought  it  to  be. 

Maurice  Leenhardt,  a  Catholic  missionary  who  had  spent  many 
long  years  teaching  the  Gospel  in  New  Caledonia,  experienced  such 
a  moment  in  the  1920s,  when  he  asked  one  of  his  students,  an  aged 
sculptor  named  Boesoou,  how  he  felt  about  having  been  introduced  to 
spiritual  ideas: 



Once,  waiting  to  assess  the  mental  progress  of  the  Canaques  I 
had  taught  for  many  years,  I  risked  the  following  suggestion: 
"In  short,  we  introduced  the  notion  of  the  spirit  to  your  way 
of  thinking?" 

He  objected,  "Spirit?  Bah!  You  didn't  bring  us  the  spirit. 
We  already  knew  the  spirit  existed.  We  have  always  acted  in 
accord  with  the  spirit.  What  you've  brought  us  is  the  body."66 

The  notion  that  humans  had  souls  appeared  to  Boesoou  to  be  self- 
evident.  The  notion  that  there  was  such  a  thing  as  the  body,  apart  from 
the  soul,  a  mere  material  collection  of  nerves  and  tissues — let  alone 
that  the  body  is  the  prison  of  the  soul;  that  the  mortification  of  the 
body  could  be  a  means  to  the  glorification  or  liberation  of  the  soul — all 
this,  it  turns  out,  struck  him  as  utterly  new  and  exotic. 

Axial  Age  spirituality,  then,  is  built  on  a  bedrock  of  materialism. 
This  is  its  secret;  one  might  almost  say,  the  thing  that  has  become 
invisible  to  us.67  But  if  one  looks  at  the  very  beginnings  of  philosophi- 
cal inquiry  in  Greece  and  India — the  point  when  there  was  as  yet  no 
difference  between  what  we'd  now  call  "philosophy"  and  what  we'd 
now  call  "science" — this  is  exactly  what  one  finds.  "Theory,"  if  we  can 
call  it  that,  begins  with  the  questions:  "What  substance  is  the  world 
made  of?"  "What  is  the  underlying  material  behind  the  physical  forms 
of  objects  in  the  world?"  "Is  everything  made  up  of  varying  combina- 
tions of  certain  basic  elements  (earth,  air,  water,  fire,  stone,  motion, 
mind,  number  .  .  .),  or  are  these  basic  elements  just  the  forms  taken  by 
some  even  more  elementary  substance  (for  instance,  as  Nyaya  and  later 
Democritus  proposed,  atomic  particles  .  .  .)"68  In  just  about  every  case, 
some  notion  of  God,  Mind,  Spirit,  some  active  organizing  principle 
that  gave  form  to  and  was  not  itself  substance,  emerged  as  well.  But 
this  was  the  kind  of  spirit  that,  like  Leenhardt's  God,  only  emerges  in 
relation  to  inert  matter.69 

To  connect  this  impulse,  too,  with  the  invention  of  coinage  might 
seem  like  pushing  things  a  bit  far  but,  at  least  for  the  Classical  world, 
there  is  an  emerging  scholarly  literature — first  set  off  by  Harvard  liter- 
ary theorist  Marc  Shell,  and  more  recently  set  forth  by  British  classicist 
Richard  Seaford  in  a  book  called  Money  and  the  Early  Greek  Mind — 
that  aims  to  do  exactly  that.70 

In  fact,  some  of  the  historical  connections  are  so  uncannily  close 
that  they  are  very  hard  to  explain  any  other  way.  Let  me  give  an  ex- 
ample. After  the  first  coins  were  minted  around  600  BC  in  the  kingdom 
of  Lydia,  the  practice  quickly  spread  to  Ionia,  the  Greek  cities  of  the 
adjacent  coast.  The  greatest  of  these  was  the  great  walled  metropolis  of 



Miletus,  which  also  appears  to  have  been  the  first  Greek  city  to  strike 
its  own  coins.  It  was  Ionia,  too,  that  provided  the  bulk  of  the  Greek 
mercenaries  active  in  the  Mediterranean  at  the  time,  with  Miletus  their 
effective  headquarters.  Miletus  was  also  the  commercial  center  of  the 
region,  and,  perhaps,  the  first  city  in  the  world  where  everyday  mar- 
ket transactions  came  to  be  carried  out  primarily  in  coins  instead  of 
credit.71  Greek  philosophy,  in  turn,  begins  with  three  men:  Thales,  of 
Miletus  (c.  624  bc-c.  546  bc),  Anaximander,  of  Miletus  (c.  610  bc-c. 
546  bc),  and  Anaximenes,  of  Miletus  (c.  585  bc-c.  52.5  bc) — in  other 
words,  men  who  were  living  in  that  city  at  exactly  the  time  that  coin- 
age was  first  introduced.72  All  three  are  remembered  chiefly  for  their 
speculations  on  the  nature  of  the  physical  substance  from  which  the 
world  ultimately  sprang.  Thales  proposed  water,  Anaximenes,  air. 
Anaximander  made  up  a  new  term,  apeiron,  "the  unlimited,"  a  kind  of 
pure  abstract  substance  that  could  not  itself  be  perceived  but  was  the 
material  basis  of  everything  that  could  be.  In  each  case,  the  assumption 
was  that  this  primal  substance,  by  being  heated,  cooled,  combined,  di- 
vided, compressed,  extended,  or  set  in  motion,  gave  rise  to  the  endless 
particular  stuffs  and  substances  that  humans  actually  encounter  in  the 
world,  from  which  physical  objects  are  composed — and  was  also  that 
into  which  all  those  forms  would  eventually  dissolve. 

It  was  something  that  could  turn  into  everything.  As  Seaford  em- 
phasizes, so  was  money.  Gold,  shaped  into  coins,  is  a  material  sub- 
stance that  is  also  an  abstraction.  It  is  both  a  lump  of  metal  and  some- 
thing more  than  a  lump  of  metal — it's  a  drachma  or  an  obol,  a  unit  of 
currency  which  (at  least  if  collected  in  sufficient  quantity,  taken  to  the 
right  place  at  the  right  time,  turned  over  to  the  right  person)  could  be 
exchanged  for  absolutely  any  other  object  whatsoever.73 

For  Seaford,  what  was  genuinely  new  about  coins  was  their  double- 
sidedness:  the  fact  that  they  were  both  valuable  pieces  of  metal  and,  at 
the  same  time,  something  more.  At  least  within  the  communities  that 
created  them,  ancient  coins  were  always  worth  more  than  the  gold, 
silver,  or  copper  of  which  they  were  composed.  Seaford  refers  to  this 
extra  value  by  the  inelegant  term  "fiduciarity,"  which  comes  from  the 
term  for  public  trust,  the  confidence  a  community  places  in  its  curren- 
cy.74 True,  at  the  height  of  Classical  Greece,  when  there  were  hundreds 
of  city-states  producing  different  currencies  according  to  a  number  of 
different  systems  of  weights  and  denominations,  merchants  often  did 
carry  scales  and  treat  coins — particularly  foreign  coins — like  so  many 
chunks  of  silver,  just  as  Indian  merchants  seem  to  have  treated  Roman 
coins;  but  within  a  city,  that  city's  currency  had  a  special  status,  since 
it  was  always  acceptable  at  face  value  when  used  to  pay  taxes,  public 



fees,  or  legal  penalties.  This  is,  incidentally,  why  ancient  governments 
were  so  often  able  to  introduce  base  metal  into  their  coins  without 
leading  to  immediate  inflation;  a  debased  coin  might  have  lost  value 
when  traded  overseas,  but  at  home,  it  was  still  worth  just  as  much 
when  purchasing  a  license,  or  entering  the  public  theater.75  This  is  also 
why,  during  pubic  emergencies,  Greek  city-states  would  occasionally 
strike  coins  made  entirely  of  bronze  or  tin,  which  everyone  would 
agree,  while  the  emergency  lasted,  to  treat  as  if  they  were  really  made 
of  silver.76 

This  is  the  key  to  Seaford's  argument  about  materialism  and  Greek 
philosophy.  A  coin  was  a  piece  of  metal,  but  by  giving  it  a  particular 
shape,  stamped  with  words  and  images,  the  civic  community  agreed 
to  make  it  something  more.  But  this  power  was  not  unlimited.  Bronze 
coins  could  not  be  used  forever;  if  one  debased  the  coinage,  inflation 
would  eventually  set  in.  It  was  as  if  there  was  a  tension  there,  between 
the  will  of  the  community  and  the  physical  nature  of  the  object  itself. 
Greek  thinkers  were  suddenly  confronted  with  a  profoundly  new  type 
of  object,  one  of  extraordinary  importance — as  evidenced  by  the  fact 
that  so  many  men  were  willing  to  risk  their  lives  to  get  their  hands  on 
it — but  whose  nature  was  a  profound  enigma. 

Consider  this  word,  "materialism."  What  does  it  mean  to  adopt  a 
"materialist"  philosophy?  What  is  "material,"  anyway?  Normally,  we 
speak  of  "materials"  when  we  refer  to  objects  that  we  wish  to  make 
into  something  else.  A  tree  is  a  living  thing.  It  only  becomes  "wood" 
when  we  begin  to  think  about  all  the  other  things  you  could  carve  out 
of  it.  And  of  course  you  can  carve  a  piece  of  wood  into  almost  any- 
thing. The  same  is  true  of  clay,  or  glass,  or  metal.  They're  solid  and 
real  and  tangible,  but  also  abstractions,  because  they  have  the  potential 
to  turn  into  almost  anything  else — or,  not  precisely  that;  one  can't  turn 
a  piece  of  wood  into  a  lion  or  an  owl,  but  one  can  turn  it  into  an  image 
of  a  lion  or  an  owl — it  can  take  on  almost  any  conceivable  form.  So 
already  in  any  materialist  philosophy,  we  are  dealing  with  an  opposi- 
tion between  form  and  content,  substance  and  shape;  a  clash  between 
the  idea,  sign,  emblem,  or  model  in  the  creator's  mind,  and  the  physical 
qualities  of  the  materials  on  which  it  is  to  be  stamped,  built,  or  im- 
posed, from  which  it  will  be  brought  into  reality.77  With  coins  this  rises 
to  an  even  more  abstract  level  because  that  emblem  can  no  longer  be 
conceived  as  the  model  in  one  person's  head,  but  is  rather  the  mark  of 
a  collective  agreement.  The  images  stamped  on  Greek  coins  (Miletus' 
lion,  Athens'  owl)  were  typically  the  emblems  of  the  city's  god,  but 
they  were  also  a  kind  of  collective  promise,  by  which  citizens  assured 
one  another  that  not  only  would  the  coin  be  acceptable  in  payment  of 



public  debts,  but  in  a  larger  sense,  that  everyone  would  accept  them, 
for  any  debts,  and  thus,  that  they  could  be  use  to  acquire  anything 
anyone  wanted. 

The  problem  is  that  this  collective  power  is  not  unlimited.  It  only 
really  applies  within  the  city.  The  farther  you  go  outside,  into  places 
dominated  by  violence,  slavery,  and  war — the  sort  of  place  where  even 
philosophers  taking  a  cruise  might  end  up  on  the  auction  block — the 
more  it  turns  into  a  mere  lump  of  precious  metal.78 

The  war  between  Spirit  and  Flesh,  then,  between  the  noble  Idea 
and  ugly  Reality,  the  rational  intellect  versus  stubborn  corporeal  drives 
and  desires  that  resist  it,  even  the  idea  that  peace  and  community  are 
not  things  that  emerge  spontaneously  but  that  need  to  be  stamped  onto 
our  baser  material  natures  like  a  divine  insignia  stamped  into  base 
metal — all  those  ideas  that  came  to  haunt  the  religious  and  philosophi- 
cal traditions  of  the  Axial  Age,  and  that  have  continued  to  surprise 
people  like  Boesoou  ever  since — can  already  be  seen  as  inscribed  in  the 
nature  of  this  new  form  of  money. 

It  would  be  foolish  to  argue  that  all  Axial  Age  philosophy  was  sim- 
ply a  meditation  on  the  nature  of  coinage,  but  I  think  Seaford  is  right 
to  argue  that  this  is  a  critical  starting  place:  one  of  the  reasons  that  the 
pre-Socratic  philosophers  began  to  frame  their  questions  in  the  peculiar 
way  they  did,  asking  (for  instance):  What  are  Ideas?  Are  they  merely 
collective  conventions?  Do  they  exist,  as  Plato  insisted,  in  some  divine 
domain  beyond  material  existence?  Or  do  they  exist  in  our  minds?  Or 
do  our  minds  themselves  ultimately  partake  of  that  divine  immate- 
rial domain?  And  if  they  do,  what  does  this  say  about  our  relation  to 
our  bodies? 

In  India  and  China,  the  debate  took  different  forms,  but  materialism 
was  always  the  starting  point.  We  only  know  the  ideas  of  most  truly 
materialist  thinkers  from  the  works  of  their  intellectual  enemies:  as  is 
the  case  with  the  Indian  king  Payasi,  who  enjoyed  debating  Buddhist 
and  Jain  philosophers,  taking  the  position  that  the  soul  does  not  exist, 
that  human  bodies  are  nothing  but  particular  configurations  of  air,  wa- 
ter, earth,  and  fire,  their  consciousness  the  result  of  the  elements'  mu- 
tual interaction,  and  that  when  we  die,  the  elements  simply  dissolve.79 
Clearly,  though,  such  ideas  were  commonplace.  Even  the  Axial  Age 
religions  are  often  startlingly  lacking  in  the  plethora  of  supernatural 
forces  seen  before  and  after:  as  witnessed  by  continued  debates  over 
whether  Buddhism  even  is  a  religion,  since  it  rejects  any  notion  of  a 



supreme  being,  or  whether  Confucius'  admonitions  that  one  should 
continue  to  venerate  one's  ancestors  was  merely  a  way  of  encouraging 
filial  piety,  or  based  on  a  belief  that  dead  ancestors  did,  in  some  sense, 
continue  to  exist.  The  fact  that  we  have  to  ask  says  everything.  Yet  at 
the  same  time,  what  endures,  above  all,  from  that  age — in  institutional 
terms — are  what  we  call  the  "world  religions." 

What  we  see  then  is  a  strange  kind  of  back-and-forth,  attack  and 
riposte,  whereby  the  market,  the  state,  war,  and  religion  all  continually 
separate  and  merge  with  one  another.  Let  me  summarize  it  as  briefly 
as  I  can: 

1)  Markets  appear  to  have  first  emerged,  in  the  Near  East  at  least,  as 
a  side  effect  of  government  administrative  systems.  Over  time,  how- 
ever, the  logic  of  the  market  became  entangled  in  military  affairs, 
where  it  became  almost  indistinguishable  from  the  mercenary  logic 
of  Axial  Age  warfare,  and  then,  finally,  that  logic  came  to  conquer 
government  itself;  to  define  its  very  purpose. 

2)  As  a  result:  everywhere  we  see  the  military-coinage-slavery  complex 
emerge,  we  also  see  the  birth  of  materialist  philosophies.  They  are 
materialist,  in  fact,  in  both  senses  of  the  term:  in  that  they  envision 
a  world  made  up  of  material  forces,  rather  than  divine  powers,  and 
in  that  they  imagine  the  ultimate  end  of  human  existence  to  be  the 
accumulation  of  material  wealth,  with  ideals  like  morality  and  jus- 
tice being  reframed  as  tools  designed  to  satisfy  the  masses. 

3)  Everywhere,  too,  we  find  philosophers  who  react  to  this  by  explor- 
ing ideas  of  humanity  and  the  soul,  attempting  to  find  a  new  foun- 
dation for  ethics  and  morality. 

4)  Everywhere  some  of  these  philosophers  made  common  cause  with 
social  movements  that  inevitably  formed  in  the  face  of  these  new 
and  extraordinarily  violent  and  cynical  elites.  The  result  was  some- 
thing new  to  human  history:  popular  movements  that  were  also 
intellectual  movements,  due  to  the  assumption  that  those  opposing 
existing  power  arrangements  did  so  in  the  name  of  some  kind  of 
theory  about  the  nature  of  reality. 

5)  Everywhere,  these  movements  were  first  and  foremost  peace  move- 
ments, in  that  they  rejected  the  new  conception  of  violence,  and 
especially  aggressive  war,  as  the  foundation  of  politics. 

6)  Everywhere  too,  there  seems  to  have  been  an  initial  impulse  to  use 
the  new  intellectual  tools  provided  by  impersonal  markets  to  come 
up  with  a  new  basis  for  morality,  and  everywhere,  it  foundered. 
Mohism,  with  its  notion  of  social  profit,  flourished  briefly  and 
then  collapsed.  It  was  replaced  by  Confucianism,  which  rejected 
such  ideas  outright.  We  have  already  seen  that  reimagining  moral 



responsibility  in  terms  of  debt — an  impulse  that  cropped  up  in  both 
Greece  and  India — while  almost  inevitable  given  the  new  economic 
circumstances,  seems  to  prove  uniformly  unsatisfying.80  The  strong- 
er impulse  is  to  imagine  another  world  where  debt — and  with  it, 
all  other  worldly  connections — can  be  entirely  annihilated,  where 
social  attachments  are  seen  as  forms  of  bondage;  just  as  the  body  is 
a  prison. 

7)  Rulers'  attitudes  changed  over  time.  At  first,  most  appear  to  have 
affected  an  attitude  of  bemused  tolerance  toward  the  new  philo- 
sophical and  religious  movements  while  privately  embracing  some 
version  of  cynical  realpolitik,  But  as  warring  cities  and  principalities 
were  replaced  by  great  empires,  and  especially,  as  those  empires 
began  to  reach  the  limits  of  their  expansion,  sending  the  military- 
coinage-slavery  complex  into  crisis,  all  this  suddenly  changed.  In 
India,  Asoka  tried  to  re-found  his  kingdom  on  Buddhism;  in  Rome, 
Constantine  turned  to  the  Christians;  in  China,  the  Han  emperor 
Wu-Ti  (157-87  BC),  faced  with  a  similar  military  and  financial  crisis, 
adopted  Confucianism  as  the  philosophy  of  state.  Of  the  three,  only 
Wu  Ti  was  ultimately  successful:  the  Chinese  empire  endured,  in  one 
form  or  another,  for  two  thousand  years,  almost  always  with  Con- 
fucianism as  its  official  ideology.  In  Constantine's  case  the  Western 
empire  fell  apart,  but  the  Roman  church  endured.  Asoka's  project 
could  be  said  to  be  the  least  successful.  Not  only  did  his  empire  fall 
apart,  replaced  by  an  endless  series  of  weaker,  usually  fragmentary 
kingdoms,  but  Buddhism  itself  was  largely  driven  out  of  his  one-time 
territories,  though  it  did  establish  itself  much  more  firmly  in  China, 
Nepal,  Tibet,  Sri  Lanka,  Korea,  Japan,  and  much  of  Southeast  Asia. 

8)  The  ultimate  effect  was  a  kind  of  ideal  division  of  spheres  of  human 
activity  that  endures  to  this  day:  on  the  one  hand  the  market,  on  the 
other,  religion.  To  put  the  matter  crudely:  if  one  relegates  a  certain 
social  space  simply  to  the  selfish  acquisition  of  material  things,  it 
is  almost  inevitable  that  soon  someone  else  will  come  to  set  aside 
another  domain  in  which  to  preach  that,  from  the  perspective  of  ul- 
timate values,  material  things  are  unimportant;  that  selfishness — or 
even  the  self — are  illusory,  and  that  to  give  is  better  than  to  receive. 
If  nothing  else,  it  is  surely  significant  that  all  the  Axial  Age  religions 
emphasized  the  importance  of  charity,  a  concept  that  had  barely 
existed  before.  Pure  greed  and  pure  generosity  are  complementary 
concepts;  neither  could  really  be  imagined  without  the  other;  both 
could  only  arise  in  institutional  contexts  that  insisted  on  such  pure 
and  single-minded  behavior;  and  both  seem  to  have  appeared  to- 
gether wherever  impersonal,  physical,  cash  money  also  appeared  on 
the  scene. 



As  for  the  religious  movements:  it  would  be  easy  enough  to  write 
them  off  as  escapist,  as  promising  the  victims  of  the  Axial  Age  em- 
pires liberation  in  the  next  world  as  a  way  of  letting  them  accept  their 
lot  in  this  one,  and  convincing  the  rich  that  all  they  really  owed  the 
poor  were  occasional  charitable  donations.  Radical  thinkers  almost 
invariably  do  write  them  off  in  this  way.  Surely,  the  willingness  of 
the  governments  themselves  to  eventually  embrace  them  would  seem 
to  support  this  conclusion.  But  the  issue  is  more  complicated.  First  of 
all,  there  is  something  to  be  said  for  escapism.  Popular  uprisings  in 
the  ancient  world  usually  ended  in  the  massacre  of  the  rebels.  As  I've 
already  observed,  physical  escape,  such  as  via  exodus  or  defection, 
has  always  been  the  most  effective  response  to  oppressive  conditions 
since  the  earliest  times  we  know  about.  Where  physical  escape  is  not 
possible,  what,  exactly,  is  an  oppressed  peasant  supposed  to  do?  Sit 
and  contemplate  her  misery?  At  the  very  least,  otherworldly  religions 
provided  glimpses  of  radical  alternatives.  Often  they  allowed  people 
to  create  other  worlds  within  this  one,  liberated  spaces  of  one  sort  or 
another.  It  is  surely  significant  that  the  only  people  who  succeeded  in 
abolishing  slavery  in  the  ancient  world  were  religious  sects,  such  as  the 
Essenes — who  did  so,  effectively,  by  defecting  from  the  larger  social 
order  and  forming  their  own  Utopian  communities.81  Or,  in  a  smaller 
but  more  enduring  example:  the  democratic  city-states  of  northern  In- 
dia were  all  eventually  stamped  out  by  the  great  empires  (Kautilya 
provides  extensive  advice  on  how  to  subvert  and  destroy  democratic 
constitutions),  but  the  Buddha  admired  the  democratic  organization  of 
their  public  assemblies  and  adopted  it  as  the  model  for  his  followers.82 
Buddhist  monasteries  are  still  called  sangha,  the  ancient  name  for  such 
republics,  and  continue  to  operate  by  the  same  consensus-finding  pro- 
cess to  this  day,  preserving  a  certain  egalitarian  democratic  ideal  that 
would  otherwise  have  been  entirely  forgotten. 

Finally,  the  larger  historical  achievements  of  these  movements  are 
not,  in  fact,  insignificant.  As  they  took  hold,  things  began  to  change. 
Wars  became  less  brutal  and  less  frequent.  Slavery  faded  as  an  in- 
stitution, to  the  point  at  which,  by  the  Middle  Ages,  it  had  become 
insignificant  or  even  nonexistent  across  most  of  Eurasia.  Everywhere 
too,  the  new  religious  authorities  began  to  seriously  address  the  social 
dislocations  introduced  by  debt. 

Chapter  Ten 


(600  -1450  AD) 

Artificial  wealth  comprises  the  things 
which  of  themselves  satisfy  no  natu- 
ral need,  for  example  money,  which  is  a 
human  contrivance. 

— St.  Thomas  Aquinas 

IF  THE  AXIAL  AGE  saw  the  emergence  of  complementary  ideals  of 
commodity  markets  and  universal  world  religions,  the  Middle  Ages 
were  the  period  in  which  those  two  institutions  began  to  merge. 

Everywhere,  the  age  began  with  the  collapse  of  empires.  Eventual- 
ly, new  states  formed,  but  in  these  new  states,  the  nexus  between  war, 
bullion,  and  slavery  was  broken;  conquest  and  acquisition  for  their 
own  sake  were  no  longer  celebrated  as  the  end  of  all  political  life.  At 
the  same  time,  economic  life,  from  the  conduct  of  international  trade 
to  the  organization  of  local  markets,  came  to  fall  increasingly  under 
the  regulation  of  religious  authorities.  One  result  was  a  widespread 
movement  to  control,  or  even  forbid,  predatory  lending.  Another  was 
a  return,  across  Eurasia,  to  various  forms  of  virtual  credit  money. 

Granted,  this  is  not  the  way  we're  used  to  thinking  of  the  Middle 
Ages.  For  most  of  us,  "Medieval"  remains  a  synonym  for  superstition, 
intolerance,  and  oppression.  Yet  for  most  of  the  earth's  inhabitants,  it 
could  only  be  seen  as  an  extraordinary  improvement  over  the  terrors 
of  the  Axial  Age. 

One  reason  for  our  skewed  perception  is  that  we're  used  to  think- 
ing of  the  Middle  Ages  as  something  that  happened  primarily  in  West- 
ern Europe,  in  territories  that  had  been  little  more  than  border  outposts 
of  the  Roman  Empire  to  begin  with.  According  to  the  convention- 
al wisdom,  with  the  collapse  of  the  empire,  the  cities  were  largely 



abandoned  and  the  economy  "reverted  to  barter,"  taking  at  least  five 
centuries  to  recover.  Even  for  Europe,  though,  this  is  based  on  a  series 
of  unquestioned  assumptions  that,  as  I've  said,  crumble  the  moment 
one  starts  seriously  poking  at  them.  Chief  among  them  is  the  idea  that 
the  absence  of  coins  means  the  absence  of  money.  True,  the  destruction 
of  the  Roman  war  machine  also  meant  that  Roman  coins  went  out  of 
circulation;  and  the  few  coins  produced  within  the  Gothic  or  Frankish 
kingdoms  that  established  themselves  over  the  ruins  of  the  old  empire 
were  largely  fiduciary  in  nature.1  Still,  a  glance  at  the  "barbarian  law 
codes"  reveals  that  even  at  the  height  of  the  Dark  Ages,  people  were  still 
carefully  keeping  accounts  in  Roman  money  as  they  calculated  interest 
rates,  contracts,  and  mortgages.  Again,  cities  shriveled,  and  many  were 
abandoned,  but  even  this  was  something  of  a  mixed  blessing.  Certainly, 
it  had  a  terrible  effect  on  literacy;  but  one  must  also  bear  in  mind  that 
ancient  cities  could  only  be  maintained  by  extracting  resources  from 
the  countryside.  Roman  Gaul,  for  instance,  had  been  a  network  of 
cities,  connected  by  the  famous  Roman  roads  to  an  endless  succession 
of  slave  plantations,  which  were  owned  by  the  urban  grandees.2  After 
around  400  ad,  the  population  of  the  towns  declined  radically,  but  the 
plantations  also  disappeared.  In  the  following  centuries,  many  came  to 
be  replaced  by  manors,  churches,  and  even  later,  castles — where  new 
local  lords  extracted  their  own  dues  from  the  surrounding  farmers.  But 
one  need  only  do  the  math:  since  Medieval  agriculture  was  no  less  ef- 
ficient than  ancient  agriculture  (in  fact,  it  rapidly  became  a  great  deal 
more  so),  the  amount  of  work  required  to  feed  a  handful  of  mounted 
warriors  and  clergymen  could  not  possibly  have  been  anything  like  that 
required  to  feed  entire  cities.  However  oppressed  Medieval  serfs  might 
have  been,  their  plight  was  nothing  compared  with  that  of  their  Axial 
Age  equivalents. 

Still,  the  Middle  Ages  proper  are  best  seen  as  having  begun  not 
in  Europe  but  in  India  and  China,  between  400  and  600  ad,  and  then 
sweeping  across  much  of  the  western  half  of  Eurasia  with  the  advent  of 
Islam.  They  only  really  reached  Europe  four  hundred  years  later.  Let 
us  begin  our  story,  then,  in  India. 

Medieval  India 
(Flight  into  Hierarchy) 

I  left  off  in  India  with  Asoka's  embrace  of  Buddhism,  but  I  noted  that 
ultimately,  his  project  foundered.  Neither  his  empire  nor  his  church 



was  to  endure.  It  took  a  good  deal  of  time,  however,  for  this  failure 
to  occur. 

The  Mauryans  represented  a  high  watermark  of  empire.  The  next 
five  hundred  years  saw  a  succession  of  kingdoms,  most  of  them  strong- 
ly supportive  of  Buddhism.  Stupas  and  monasteries  sprang  up  every- 
where, but  the  states  that  sponsored  them  grew  weaker  and  weaker; 
centralized  armies  dissolved;  soldiers,  like  officials,  increasingly  came 
to  be  paid  by  land  grants  rather  than  salaries.  As  a  result,  the  number 
of  coins  in  circulation  steadily  declined.3  Here  too,  the  early  Middle 
Ages  witnessed  a  dramatic  decline  of  cities:  where  the  Greek  ambassa- 
dor Megasthenes  described  Asoka's  capital  of  Patna  as  the  largest  city 
in  the  world  of  his  day,  Medieval  Arab  and  Chinese  travelers  described 
India  as  a  land  of  endless  tiny  villages. 

As  a  result,  most  historians  have  come  to  write,  much  as  they  do 
in  Europe,  of  a  collapse  of  the  money  economy;  of  commerce  becom- 
ing a  "reversion  to  barter."  Here  too,  this  appears  to  be  simply  untrue. 
What  vanished  were  the  military  means  to  extract  resources  from  the 
peasants.  In  fact,  Hindu  law-books  written  at  the  time  show  increasing 
attention  to  credit  arrangements,  with  a  sophisticated  language  of  sure- 
ties, collateral,  mortgages,  promissory  notes,  and  compound  interest.4 
One  need  only  consider  how  the  Buddhist  establishments  popping  up 
all  over  India  during  these  centuries  were  funded.  While  the  earliest 
monks  were  wandering  mendicants,  owning  little  more  than  their  beg- 
ging bowls,  early  Medieval  monasteries  were  often  magnificent  estab- 
lishments with  vast  treasuries.  Still,  in  principle,  their  operations  were 
financed  almost  entirely  through  credit. 

The  key  innovation  was  the  creation  of  what  were  called  the  "per- 
petual endowments"  or  "inexhaustible  treasuries."  Say  a  lay  supporter 
wished  to  make  a  contribution  to  her  local  monastery.  Rather  than 
offering  to  provide  candles  for  a  specific  ritual,  or  servants  to  attend  to 
the  upkeep  of  the  monastic  grounds,  she  would  provide  a  certain  sum 
of  money — or  something  worth  a  great  deal  of  money — that  would 
then  be  loaned  out  in  the  name  of  the  monastery,  at  the  accepted  15 
-percent  annual  rate.  The  interest  on  the  loan  would  then  be  earmarked 
for  that  specific  purpose.5  An  inscription  discovered  at  the  Great  Mon- 
astery of  Sanci  sometime  around  450  ad  provides  a  handy  illustration. 
A  woman  named  Harisvamini  donates  the  relatively  modest  sum  of 
twelve  dinar  as  to  the  "Noble  Community  of  Monks."6  The  text  care- 
fully inscribes  how  the  income  is  to  be  divided  up:  the  interest  on  five 
of  the  dinaras  was  to  provide  daily  meals  for  five  different  monks, 
the  interest  from  another  three  would  pay  to  light  three  lamps  for 
the  Buddha,  in  memory  of  her  parents,  and  so  forth.  The  inscription 



ends  by  saying  that  this  was  a  permanent  endowment,  "created  with  a 
document  in  stone  to  last  as  long  as  the  moon  and  the  sun":  since  the 
principal  would  never  be  touched,  the  contribution  would  last  forever.7 

Some  of  these  loans  presumably  went  to  individuals,  others  were 
commercial  loans  to  "guilds  of  bamboo-workers,  braziers,  and  pot- 
ters," or  to  village  assemblies.8  We  have  to  assume  that  in  most  cases 
the  money  is  an  accounting  unit:  what  were  really  being  transacted 
were  animals,  wheat,  silk,  butter,  fruit,  and  all  the  other  goods  whose 
appropriate  rates  of  interest  were  so  carefully  stipulated  in  the  law- 
codes  of  the  time.  Still,  large  amounts  of  gold  did  end  up  flowing  into 
monastic  coffers.  When  coins  go  out  of  circulation,  after  all,  the  metal 
doesn't  simply  disappear.  In  the  Middle  Ages — and  this  seems  to  have 
been  true  across  Eurasia — the  vast  majority  of  it  ended  up  in  religious 
establishments,  churches,  monasteries,  and  temples,  either  stockpiled 
in  hoards  and  treasuries  or  gilded  onto  or  cast  into  altars,  sanctums, 
and  sacred  instruments.  Above  all,  it  was  shaped  into  images  of  gods. 
As  a  result,  those  rulers  who  did  try  to  put  an  Axial  Age-style  coin- 
age system  back  into  circulation — invariably,  to  fund  some  project  of 
military  expansion — often  had  to  pursue  self-consciously  anti-religious 
policies  in  order  to  do  so.  Probably  the  most  notorious  was  one  Harsa, 
who  ruled  Kashmir  from  1089  to  1101  ad,  who  is  said  to  have  ap- 
pointed an  officer  called  the  "Superintendent  for  the  Destruction  of  the 
Gods."  According  to  later  histories,  Harsa  employed  leprous  monks  to 
systematically  desecrate  divine  images  with  urine  and  excrement,  thus 
neutralizing  their  power,  before  dragging  them  off  to  be  melted  down.9 
He  is  said  to  have  destroyed  more  than  four  thousand  Buddhist  estab- 
lishments before  being  betrayed  and  killed,  the  last  of  his  dynasty — and 
his  miserable  fate  was  long  held  out  as  an  example  of  where  the  revival 
of  the  old  ways  was  likely  to  lead  one  in  the  end. 

For  the  most  part,  then,  the  gold  remained  sacrosanct,  laid  up  in 
the  sacred  places — though  in  India,  over  time  these  were  increasingly 
Hindu  ones,  not  Buddhist.  What  we  now  see  as  traditional  Hindu- 
village  India  appears  to  have  been  largely  a  creation  of  the  early  Middle 
Ages.  We  do  not  know  precisely  how  it  happened.  As  kingdoms  contin- 
ued to  rise  and  fall,  the  world  inhabited  by  kings  and  princes  became 
increasingly  distant  from  that  of  most  people's  everyday  affairs.  During 
much  of  the  period  immediately  following  the  collapse  of  the  Mau- 
ryan  empire,  for  instance,  much  of  India  was  governed  by  foreigners.10 
Apparently,  this  increasing  distance  allowed  local  Brahmins  to  begin 
reshaping  the  new — increasingly  rural — society  along  strictly  hierarchi- 
cal principles. 



They  did  it  above  all  by  seizing  control  of  the  administration  of 
law.  The  Dharmasastra,  law-codes  produced  by  Brahmin  scholars  be- 
tween roughly  200  BC  and  400  ad,  give  us  a  good  idea  of  the  new  vision 
of  society.  In  it,  old  ideas  like  the  Vedic  conception  of  a  debt  to  gods, 
sages,  and  ancestors  were  resuscitated — but  now,  they  applied  only  and 
specifically  to  Brahmins,  whose  duty  and  privilege  it  was  to  stand  in  for 
all  humanity  before  the  forces  that  controlled  the  universe."  Far  from 
being  required  to  attain  learning,  members  of  the  inferior  classes  were 
forbidden  to  do  so:  the  Laws  of  Manu,  for  instance,  set  down  that  any 
Sudra  (the  lowest  caste,  assigned  to  farming  and  material  production) 
who  so  much  as  listened  in  on  the  teaching  of  the  law  or  sacred  texts 
should  have  molten  lead  poured  into  their  ears;  on  the  occasion  of  a 
repeat  offense,  have  their  tongues  cut  out.12  At  the  same  time  Brahmins, 
however  ferociously  they  guarded  their  privileges,  also  adopted  aspects 
of  once-radical  Buddhist  and  Jain  ideas  like  karma,  reincarnation,  and 
ahimsa.  Brahmins  were  expected  to  refrain  from  any  sort  of  physical 
violence,  and  even  to  become  vegetarians.  In  alliance  with  representa- 
tives of  the  old  warrior  caste,  they  also  managed  to  win  control  of  most 
of  the  land  in  the  ancient  villages.  Artisans  and  craftsmen  fleeing  the 
decline  or  destruction  of  cities  often  ended  up  as  suppliant  refugees, 
and,  gradually,  low-caste  clients.  The  result  were  increasingly  complex 
local  patronage  systems  in  the  countryside — jajmani  systems,  as  they 
came  to  be  known — where  the  refugees  provided  services  for  the  land- 
owning castes,  who  took  on  many  of  the  roles  once  held  by  the  state, 
providing  protection  and  justice,  extracting  labor  dues,  and  so  on — but 
also  protected  local  communities  from  actual  royal  representatives.13 

This  latter  function  is  crucial.  Foreign  visitors  were  later  to  be 
awed  by  the  self-sufficiency  of  the  traditional  Indian  village,  with  its 
elaborate  system  of  landowning  castes,  farmers,  and  such  "service 
castes"  as  barbers,  smiths,  tanners,  drummers,  and  washermen,  all  ar- 
ranged in  hierarchical  order,  each  seen  as  making  its  own  unique  and 
necessary  contribution  to  their  little  society,  all  of  it  typically  operat- 
ing entirely  without  the  use  of  metal  currency.  It  was  only  possible 
for  those  reduced  to  the  status  of  Sudras  and  Untouchables  to  have 
a  chance  of  accepting  their  lowly  position  because  the  exaction  of  lo- 
cal landlords  was,  again,  on  nothing  like  the  same  scale  as  that  under 
earlier  governments — under  which  villagers  had  to  support  cities  of  up- 
wards of  a  million  people — and  because  the  village  community  became 
an  effective  means  of  holding  the  state  and  its  representatives  at  least 
partially  at  bay. 

We  don't  know  the  mechanisms  that  brought  this  world  about,  but 
the  role  of  debt  was  surely  significant.  The  creation  of  thousands  of 



Hindu  temples  alone  must  have  involved  hundreds  of  thousands,  even 
millions,  of  interest-bearing  loans — since,  while  Brahmins  were  them- 
selves forbidden  to  lend  money  at  interest,  temples  were  not.  We  can 
already  see,  in  the  earliest  of  the  new  law-codes,  the  Laws  of  Manu,  the 
way  that  local  authorities  were  struggling  to  reconcile  old  customs  like 
debt  peonage  and  chattel  slavery  with  the  desire  to  establish  an  over- 
arching hierarchical  system  in  which  everyone  knew  their  place.  The 
Laws  of  Manu  carefully  classify  slaves  into  seven  types  depending  on 
how  they  were  reduced  to  slavery  (war,  debt,  self-sale  .  .  .)  and  explain 
the  conditions  under  which  each  might  be  emancipated — but  then  go 
on  to  say  that  Sudras  can  never  really  be  emancipated,  since,  after  all, 
they  were  created  to  serve  the  other  castes.14  Similarly,  where  earlier 
codes  had  established  a  15-percent  annual  rate  of  interest,  with  excep- 
tions for  commercial  loans,"  the  new  codes  organized  interest  by  caste: 
stating  that  one  could  charge  a  maximum  of  2  percent  a  month  for 
a  Brahmin,  3  percent  for  a  Ksatriya  (warrior),  4  percent  for  a  Vaisya 
(merchant),  and  5  percent  for  a  Sudra — which  is  the  difference  between 
24  percent  annually  on  the  one  extreme  and  a  hefty  60  percent  on  the 
other.16  The  laws  also  identify  five  different  ways  interest  can  be  paid, 
of  which  the  most  significant  for  our  concerns  is  "bodily  interest": 
physical  labor  in  the  creditor's  house  or  fields,  to  be  rendered  until  such 
time  as  the  principal  is  cleared.  Even  here,  though,  caste  considerations 
were  paramount.  No  one  could  be  forced  into  the  service  of  anyone 
of  lower  caste;  moreover,  since  debts  were  enforceable  on  a  debtor's 
children  and  even  grandchildren,  "until  the  principal  is  cleared"  could 
mean  quite  some  time — as  the  Indian  historian  R.S.  Sharma  notes,  such 
stipulations  "remind  us  of  the  present  practice  according  to  which  sev- 
eral generations  of  the  same  family  have  been  reduced  to  the  position 
of  hereditary  ploughmen  in  consideration  of  some  paltry  sum  advanced 
to  them."17 

Indeed,  India  has  become  notorious  as  a  country,  in  which  a  very 
large  part  of  the  working  population  is  laboring  in  effective  debt  peon- 
age to  a  landlord  or  other  creditor.  Such  arrangements  became  even 
easier  over  time.  By  about  1000  ad,  restrictions  on  usury  by  members 
of  the  upper  castes  in  Hindu  law-codes  largely  disappeared.  On  the 
other  hand,  1000  ad  was  about  the  same  time  that  Islam  appeared 
in  India — a  religion  dedicated  to  eradicating  usury  altogether.  So  at 
the  very  least  we  can  say  that  these  things  never  stopped  being  con- 
tested. And  even  Hindu  law  of  that  time  was  far  more  humane  than 
almost  anything  found  in  the  ancient  world.  Debtors  were  not,  gener- 
ally speaking,  reduced  to  slavery,  and  there  is  no  widespread  evidence 
of  the  selling  of  women  or  children.  In  fact,  overt  slavery  had  largely 



vanished  from  the  countryside  by  this  time.  And  debt  peons  were  not 
even  pawns,  exactly;  by  law,  they  were  simply  paying  interest  on  a 
freely  contracted  agreement.  Even  when  that  took  generations,  the  law 
stipulated  that  even  if  the  principal  was  never  paid,  in  the  third  genera- 
tion, they  would  be  freed. 

There  is  a  peculiar  tension  here:  a  kind  of  paradox.  Debt  and 
credit  arrangements  may  well  have  played  a  crucial  role  in  creating  the 
Indian  village  system,  but  they  could  never  really  become  their  basis.  It 
might  have  made  a  certain  sense  to  declare  that,  just  as  Brahmins  had 
to  dispatch  their  debts  to  the  gods,  everyone  should  be,  in  a  certain 
sense,  in  debt  to  those  above  them.  But  in  another  sense,  that  would 
have  completely  subverted  the  very  idea  of  caste,  which  was  that  the 
universe  was  a  vast  hierarchy  in  which  different  sorts  of  people  were 
assumed  to  be  of  fundamentally  different  natures,  that  these  ranks  and 
grades  were  fixed  forever,  and  that  when  goods  and  services  moved 
up  and  down  the  hierarchy,  they  followed  not  principles  of  exchange 
at  all  but  (as  in  all  hierarchical  systems)  custom  and  precedent.  The 
French  anthropologist  Louis  Dumont  made  the  famous  argument  that 
one  cannot  even  really  talk  about  "inequality"  here,  because  to  use 
that  phrase  implies  that  one  believes  people  should  or  could  be  equal, 
and  this  idea  was  completely  alien  to  Hindu  conceptions.18  For  them 
to  have  imagined  their  responsibilities  as  debts  would  have  been  pro- 
foundly subversive,  since  debts  are  by  definition  arrangements  between 
equals — at  least  in  the  sense  that  they  are  equal  parties  to  a  contract — 
that  could  and  should  be  repaid.19 

Politically,  it  is  never  a  particularly  good  idea  to  first  tell  people 
they  are  your  equals,  and  then  humiliate  and  degrade  them.  This  is 
presumably  why  peasant  insurrections,  from  Chiapas  to  Japan,  have  so 
regularly  aimed  to  wipe  out  debts,  rather  than  focus  on  more  structural 
issues  like  caste  systems,  or  even  slavery.20  The  British  Raj  discov- 
ered this  to  their  occasional  chagrin  when  they  used  debt  peonage — 
superimposed  on  the  caste  system — as  the  basis  of  their  labor  system 
in  colonial  India.  Perhaps  the  paradigmatic  popular  insurrection  was 
the  Deccan  riots  of  1875,  when  indebted  farmers  rose  up  to  seize  and 
systematically  destroy  the  account  books  of  local  money-lenders.  Debt 
peonage,  it  would  appear,  is  far  more  likely  to  inspire  outrage  and  col- 
lective action  than  is  a  system  premised  on  pure  inequality. 




Buddhism  and  the  Economy  of  Infinite  Debt 

By  Medieval  standards,  India  was  unusual  for  resisting  the  appeal  of 
the  great  Axial  Age  religions,  but  we  observe  the  basic  pattern:  the 
decline  of  empire,  armies,  and  cash  economy,  the  rise  of  religious  au- 
thorities, independent  of  the  state,  who  win  much  of  their  popular 
legitimacy  through  their  ability  to  regulate  emerging  credit  systems. 

China  might  be  said  to  represent  the  opposite  extreme.  This  was 
the  one  place  where  a  late  Axial  Age  attempt  to  yoke  empire  and  re- 
ligion together  was  a  complete  success.  True,  here  as  elsewhere,  there 
was  an  initial  period  of  breakdown:  after  the  collapse  of  the  Han  dy- 
nasty around  220  ad,  the  central  state  broke  apart,  cities  shrank,  coins 
disappeared,  and  so  on.  But  in  China  this  was  only  temporary.  As  Max 
Weber  long  ago  pointed  out,  once  one  sets  up  a  genuinely  effective 
bureaucracy,  it's  almost  impossible  to  get  rid  of  it.  And  the  Chinese 
bureaucracy  was  uniquely  effective.  Before  long,  the  old  Han  system 
reemerged:  a  centralized  state,  run  by  Confucian  scholar-gentry  trained 
in  the  literary  classics,  selected  through  a  national  exam  system,  work- 
ing in  meticulously  organized  national  and  regional  bureaus  where  the 
money  supply,  like  other  economic  matters,  was  continually  monitored 
and  regulated.  Chinese  monetary  theory  was  always  chartalist.  This 
was  partly  just  an  effect  of  size:  the  empire  and  its  internal  market  were 
so  huge  that  foreign  trade  was  never  especially  important;  therefore, 
those  running  the  government  were  well  aware  that  they  could  turn 
pretty  much  anything  into  money,  simply  by  insisting  that  taxes  be 
paid  in  that  form. 

The  two  great  threats  to  the  authorities  were  always  the  same: 
the  nomadic  peoples  to  the  north  (who  they  systematically  bribed,  but 
who  nonetheless  periodically  swept  over  and  conquered  sections  of 
China)  and  popular  unrest  and  rebellion.  The  latter  was  almost  con- 
stant, and  on  a  scale  unknown  anywhere  else  in  human  history.  There 
were  decades  in  Chinese  history  when  the  rate  of  recorded  peasant 
uprisings  was  roughly  1.8  per  hour.11  What's  more,  such  uprisings  were 
frequently  successful.  Most  of  the  most  famous  Chinese  dynasties  that 
were  not  the  product  of  barbarian  invasion  (the  Yuan  or  Qing)  were 
originally  peasant  insurrections  (the  Han,  Tang,  Sung,  and  Ming).  In 
no  other  part  of  the  world  do  we  see  anything  like  this.  As  a  result, 
Chinese  statecraft  ultimately  came  down  to  funneling  enough  resources 
to  the  cities  to  feed  the  urban  population  and  keep  the  nomads  at 



bay,  without  causing  a  notoriously  contumacious  rural  population  to 
rise  up  in  arms.  The  official  Confucian  ideology  of  patriarchal  au- 
thority, equal  opportunity,  promotion  of  agriculture,  light  taxes,  and 
careful  government  control  of  merchants  seemed  expressly  designed 
to  appeal  to  the  interests  and  sensibilities  of  a  (potentially  rebellious) 
rural  patriarch.22 

One  need  hardly  add  that  in  these  circumstances,  limiting  the  dep- 
redations of  the  local  village  loan  shark — the  traditional  bane  of  rural 
families — was  a  constant  government  concern.  Over  and  over  we  hear 
the  same  familiar  story:  peasants  down  on  their  luck,  whether  due  to 
natural  disaster  or  the  need  to  pay  for  a  parent's  funeral — would  fall 
into  the  hands  of  predatory  lenders,  who  would  seize  their  fields  and 
houses,  forcing  them  to  work  or  pay  rent  in  what  had  once  been  their 
own  lands;  the  threat  of  rebellion  would  then  drive  the  government 
to  institute  a  dramatic  program  of  reforms.  One  of  the  first  we  know 
about  came  in  the  form  of  a  coup  d'etat  in  9  ad,  when  a  Confucian 
official  named  Wang  Mang  seized  the  throne  to  deal  (so  he  claimed) 
with  a  nationwide  debt  crisis.  According  to  proclamations  made  at  the 
time,  the  practice  of  usury  had  caused  the  effective  tax  rate  (that  is,  the 
amount  of  the  average  peasant's  harvest  that  ended  up  being  carried 
off  by  someone  else)  to  rise  from  just  over  3  percent,  to  50  percent.23 
In  reaction,  Wang  Mang  instituted  a  program  reforming  the  currency, 
nationalizing  large  estates,  promoting  state-run  industries — including 
public  granaries — and  banning  private  holding  of  slaves.  Wang  Mang 
also  established  a  state  loan  agency  that  would  offer  interest-free  fu- 
neral loans  for  up  to  ninety  days  for  those  caught  unprepared  by  the 
death  of  relatives,  as  well  as  long-term  loans  of  3  percent  monthly  or 
10  percent  annual  income  rates  for  commercial  or  agricultural  invest- 
ments.24 "With  this  scheme,"  one  historian  remarks,  "Wang  was  confi- 
dent that  all  business  transactions  would  be  under  his  scrutiny  and  the 
abuse  of  usury  would  be  forever  eradicated."23 

Needless  to  say,  it  was  not,  and  later  Chinese  history  is  full  of 
similar  stories:  widespread  inequality  and  unrest  followed  by  the  ap- 
pointment of  official  commissions  of  inquiry,  regional  debt  relief  (either 
blanket  amnesties  or  annulments  of  all  loans  in  which  interest  had  ex- 
ceeded the  principal),  cheap  grain  loans,  famine  relief,  laws  against  the 
selling  of  children.26  All  this  became  the  standard  fare  of  government 
policy.  It  was  very  unevenly  successful;  it  certainly  did  not  create  an 
egalitarian  peasant  Utopia,  but  it  prevented  any  widespread  return  to 
Axial  Age  conditions. 

We  are  used  to  thinking  of  such  bureaucratic  interventions — 
particularly  the  monopolies  and  regulations — as  state  restriction  on 



"the  market" — owing  to  the  prevailing  prejudice  that  sees  markets  as 
quasi-natural  phenomena  that  emerge  by  themselves,  and  governments 
as  having  no  role  other  than  to  squelch  or  siphon  from  them.  I  have 
repeatedly  pointed  out  how  mistaken  this  is,  but  China  provides  a 
particularly  striking  example.  The  Confucian  state  may  have  been  the 
world's  greatest  and  most  enduring  bureaucracy,  but  it  actively  pro- 
moted markets,  and  as  a  result,  commercial  life  in  China  soon  became 
far  more  sophisticated,  and  markets  more  developed,  than  anywhere 
else  in  the  world. 

This  despite  the  fact  that  Confucian  orthodoxy  was  overtly  hostile 
to  merchants  and  even  the  profit  motive  itself.  Commercial  profit  was 
seen  as  legitimate  only  as  compensation  for  the  labor  that  merchants 
expended  in  transporting  goods  from  one  place  to  another,  but  never 
as  fruits  of  speculation.  What  this  meant  in  practice  was  that  they  were 
pro-market  but  anti-capitalist. 

Again,  this  seems  bizarre,  since  we're  used  to  assuming  that  capital- 
ism and  markets  are  the  same  thing,  but,  as  the  great  French  historian 
Fernand  Braudel  pointed  out,  in  many  ways  they  could  equally  well  be 
conceived  as  opposites.  While  markets  are  ways  of  exchanging  goods 
through  the  medium  of  money — historically,  ways  for  those  with  a  sur- 
plus of  grain  to  acquire  candles  and  vice  versa  (in  economic  shorthand, 
C-M-C,  for  commodity-money-other  commodity) — capitalism  is  first 
and  foremost  the  art  of  using  money  to  get  more  money  (M-C-M'). 
Normally,  the  easiest  way  to  do  this  is  by  establishing  some  kind  of 
formal  or  de  facto  monopoly.  For  this  reason,  capitalists,  whether  mer- 
chant princes,  financiers,  or  industrialists,  invariably  try  to  ally  them- 
selves with  political  authorities  to  limit  the  freedom  of  the  market,  so  as 
to  make  it  easier  for  them  to  do  so.27  From  this  perspective,  China  was 
for  most  of  its  history  the  ultimate  anti-capitalist  market  state.28  Unlike 
later  European  princes,  Chinese  rulers  systematically  refused  to  team 
up  with  would-be  Chinese  capitalists  (who  always  existed).  Instead, 
like  their  officials,  they  saw  them  as  destructive  parasites — though,  un- 
like the  usurers,  ones  whose  fundamentally  selfish  and  antisocial  mo- 
tivations could  still  be  put  to  use  in  certain  ways.  In  Confucian  terms, 
merchants  were  like  soldiers.  Those  drawn  to  a  career  in  the  military 
were  assumed  to  be  driven  largely  by  a  love  of  violence.  As  individuals, 
they  were  not  good  people;  but  they  were  also  necessary  to  defend  the 
frontiers.  Similarly,  merchants  were  driven  by  greed  and  basically  im- 
moral; yet  if  kept  under  careful  administrative  supervision,  they  could 
be  made  to  serve  the  public  good."  Whatever  one  might  think  of  the 
principles,  the  results  are  hard  to  deny.  For  most  of  its  history,  China 
maintained  the  highest  standard  of  living  in  the  world — even  England 



only  really  overtook  it  in  perhaps  the  1820s,  well  past  the  time  of  the 
Industrial  Revolution.30 

Confucianism  is  not  precisely  a  religion,  perhaps;  it  is  usually  con- 
sidered more  an  ethical  and  philosophical  system.  So  China  too  could 
be  considered  something  of  a  departure  from  the  common  Medieval 
pattern,  whereby  commerce  was,  almost  everywhere,  brought  under 
the  control  of  religion.  But  it  wasn't  a  complete  departure.  One  need 
only  consider  the  remarkable  economic  role  of  Buddhism  in  this  same 
period.  Buddhism  had  arrived  in  China  through  the  Central  Asia  cara- 
van routes  and  in  its  early  days  was  largely  a  religion  promoted  by 
merchants,  but  in  the  chaos  following  the  collapse  of  the  Han  dynasty 
in  220  ad,  it  began  to  take  popular  roots.  The  Liang  (502-557)  and 
Tang  (618-907)  dynasties  saw  outbreaks  of  passionate  religious  fervor, 
in  which  thousands  of  rural  young  people  across  China  would  re- 
nounce their  farms,  shops,  and  families  to  seek  ordination  as  Buddhist 
monks  and  nuns;  where  merchants  or  landed  magnates  pledged  their 
entire  fortunes  to  the  propagation  of  the  Dharma;  building  projects 
hollowed  out  whole  mountains  to  create  bodhisattvas  and  giant  statues 
of  the  Buddha;  and  pageants  where  monks  and  devotees  ritually  burned 
their  heads  and  hands  or,  in  some  instances,  set  themselves  on  fire.  By 
the  mid-fifth  century,  there  were  dozens  of  such  spectacular  suicides; 
they  became,  as  one  historian  put  it  "a  macabre  kind  of  fashion."31 

Historians  differ  over  their  meaning.  Certainly  the  passions  un- 
leashed provided  a  dramatic  alternative  to  the  staid  orthodoxy  of  the 
Confucian  literati,  but  it's  also  surprising,  to  say  the  least,  to  see  this 
in  a  religion  promoted  above  all  by  the  commercial  classes.  The  French 
Sinologist  Jacques  Gernet  observes: 

It  is  clear  that  these  suicides,  so  contrary  to  traditional  moral- 
ity, aimed  to  redeem  the  sins  of  all  beings,  to  compel  the  gods 
and  men  at  one  and  the  same  time.  And  they  were  staged: 
usually,  in  the  fifth  century,  a  pyre  was  erected  on  a  mountain. 
The  suicide  took  place  in  the  presence  of  a  large  crowd  uttering 
lamentations  and  bringing  forward  rich  offerings.  People  of  all 
social  ranks  attended  the  spectacle  together.  After  the  fire  had 
burned  out,  the  ashes  of  the  monk  were  collected  and  a  stupa, 
a  new  place  of  worship,  was  created  to  house  them.32 

Gernet's  picture  of  dozens  of  Christ-like  redeemers  seems  overstat- 
ed, but  the  precise  meaning  of  these  suicides  was  unclear — and  widely 
debated — even  in  the  Middle  Ages.  Some  contemporaries  saw  them  as 
the  ultimate  expression  of  contempt  for  the  body;  others  as  recognition 



of  the  illusory  nature  of  the  self  and  all  material  attachments;  yet  oth- 
ers, as  the  ultimate  form  of  charity,  the  giving  of  that  which  can  only 
be  most  precious,  one's  very  physical  existence,  as  a  sacrifice  to  the 
benefit  of  all  living  things;  a  sentiment  that  one  tenth-century  biogra- 
pher expressed  in  the  following  verses: 

To  give  away  the  thing  that  is  difficult  to  part  with, 
Is  the  best  offering  amongst  the  alms. 
Let  this  impure  and  sinful  body, 
Turn  into  something  like  a  diamond.3' 

That  is,  an  object  of  eternal  value,  an  investment  that  can  bear 
fruit  for  all  eternity. 

I  draw  attention  to  this  because  this  sentiment  provides  an  elegant 
illustration  of  a  problem  that  seems  to  have  first  appeared  in  the  world 
with  notions  of  pure  charity  that  always  seemed  to  accompany  Axial 
Age  religions,  and  which  provided  endless  philosophical  conundrums. 
In  human  economies,  it  does  not  appear  to  have  occurred  to  anyone 
that  any  act  could  be  either  purely  selfish  or  purely  altruistic.  As  I 
noted  in  chapter  five,  an  act  of  absolute  selfless  giving  can  only  also  be 
absolutely  antisocial — hence  in  a  way,  inhuman.  It  is  merely  the  mirror 
image  of  an  act  of  theft  or  even  murder;  hence,  it  makes  a  certain  sort 
of  sense  that  suicide  be  conceived  as  the  ultimate  selfless  gift.  Yet  this 
is  the  door  that  necessarily  opens  as  soon  as  one  develops  a  notion  of 
"profit"  and  then  tries  to  conceive  its  opposite. 

This  tension  seems  to  hang  over  the  economic  life  of  Medieval 
Chinese  Buddhism,  which,  true  to  its  commercial  origins,  retained  a 
striking  tendency  to  employ  the  language  of  the  marketplace.  "One 
purchases  felicity,  and  sells  one's  sins,"  wrote  one  monk,  "just  as 
in  commercial  operations."34  Nowhere  was  this  so  true  as  in  those 
schools,  such  as  the  School  of  the  Three  Stages,  that  adopted  the  notion 
of  "karmic  debt" — that  each  of  the  sins  of  one's  accumulated  past  lives 
continues  as  a  debt  needing  to  be  discharged.  An  obscure  and  unusual 
view  in  classical  Indian  Buddhism,  the  notion  of  karmic  debt  took  on 
a  powerful  new  life  in  China.35  As  one  Three  Stages  text  puts  it,  we  all 
know  that  insolvent  debtors  will  be  reborn  as  animals  or  slaves;  but 
in  reality,  we  are  all  insolvent  debtors,  because  acquiring  the  money  to 
repay  our  temporal  debts  necessarily  means  acquire  new,  spiritual  ones, 
since  every  means  of  acquiring  wealth  will  necessarily  involve  exploit- 
ing, damaging,  and  causing  suffering  to  other  living  beings. 

Some  use  their  power  and  authority  as  officials  in  order  to  bend 
the  law  and  seize  wealth.  Some  prosper  in  the  marketplace  .  .  . 



They  engage  in  an  excess  of  lies  and  cheat  and  extort  prof- 
its from  others.  Still  others,  farmers,  burn  the  mountains  and 
marshes,  flood  the  fields,  plough  and  mill,  destroying  the  nests 
and  burrows  of  animals  .  .  . 

There  is  no  avoiding  the  fact  of  our  past  debts,  and  it  is 
difficult  to  comprehend  the  number  of  separate  lives  it  would 
require  if  you  wanted  to  pay  them  one  by  one."' 

As  Gernet  remarks,  the  idea  of  life  as  an  endless  burden  of  debt 
would  surely  have  struck  a  chord  with  Chinese  villagers,  for  whom 
this  was  all  too  often  literally  true;  but,  as  he  also  points  out,  like  their 
counterparts  in  ancient  Israel,  they  were  also  familiar  with  that  sense 
of  sudden  liberation  that  came  with  official  amnesties.  There  was  a 
way  to  achieve  that  too.  All  that  was  required  was  to  make  regular 
donations  to  some  monastery's  Inexhaustible  Treasury.  The  moment 
one  does  so,  the  debts  from  every  one  of  one's  past  lives  are  instantly 
blotted  out.  The  author  even  provides  a  little  parable,  not  unlike  Je- 
sus's  parable  of  the  ungrateful  servant,  but  far  more  optimistic.  How, 
it  might  be  asked,  would  a  poor  man's  tiny  contribution  possibly  have 
such  cosmic  effects? 

Answer:  In  a  parable  it  is  like  a  poor  man  burdened  by  a  debt 
of  one  thousand  strings  of  coins  to  another  person.  He  always 
suffers  from  his  debt,  and  the  poor  man  is  afraid  whenever  the 
debt-master  comes  to  collect. 

He  visits  the  rich  man's  house  and  confesses  he  is  beyond 
the  time-limit  and  begs  forgiveness  for  his  offense — he  is  poor 
and  without  a  station  in  life.  He  tells  him  that  each  day  he 
makes  a  single  coin  he  will  return  it  to  the  rich  man.  On  hear- 
ing this,  the  rich  man  is  very  pleased  and  forgives  him  for  being 
overdue;  moreover,  the  poor  man  is  not  dragged  away  to  jail. 

Giving  to  the  Inexhaustible  Storehouse  is  also  like  this.37 

One  might  almost  call  this  salvation  on  the  installment  plan — but 
the  implication  is  that  the  payments  shall  be  made,  like  the  interest 
payments  on  the  wealth  when  it  is  subsequently  loaned  out,  for  all 

Other  schools  concentrated  not  on  karmic  debt,  but  on  one's  debt 
to  one's  parents.  Where  Confucians  built  their  system  of  morality 
above  all  on  filial  piety  to  fathers,  Chinese  Buddhists  were  primarily 
concerned  with  mothers;  with  the  care  and  suffering  required  in  rais- 
ing, feeding,  and  educating  children.  A  mother's  kindness  is  unlimited, 
her  selflessness  absolute;  this  was  seen  to  be  embodied  above  all  in  the 



act  of  breastfeeding,  the  fact  that  mothers  transform  their  very  flesh 
and  blood  into  milk;  they  feed  their  children  with  their  own  bodies.  In 
doing  so,  however,  they  allow  unlimited  love  to  be  precisely  quantified. 
One  author  calculated  that  the  average  infant  absorbs  precisely  180 
pecks  of  mother's  milk  in  its  first  three  years  of  life,  and  this  consti- 
tutes its  debt  as  an  adult.  The  figure  soon  became  canonical.  To  repay 
this  milk  debt,  or  indeed  one's  debt  to  one's  parents  more  generally, 
was  simply  impossible.  "If  you  stacked  up  jewels  from  the  ground  up 
to  the  twenty-eighth  heaven,"  wrote  one  Buddhist  author,  "it  would 
not  compare"  with  the  value  of  your  parent's  nurturance.38  Even  if  you 
were  to  "cut  your  own  flesh  to  offer  her  three  times  a  day  for  four  bil- 
lion years,"  wrote  another,  "it  would  not  pay  back  even  a  single  day" 
of  what  your  mother  did  for  you.39 

The  solution,  however,  is  the  same:  donating  money  to  the  Inex- 
haustible Treasuries.  The  result  was  an  elaborate  cycle  of  debts  and 
forms  of  redemption.  A  man  begins  with  an  unpayable  milk-debt.  The 
only  thing  of  comparable  value  is  the  Dharma,  the  Buddhist  truth  it- 
self. One  can  thus  repay  one's  parents  by  bringing  them  to  Buddhism; 
indeed,  this  can  be  done  even  after  death,  when  one's  mother  will  oth- 
erwise wind  up  as  a  hungry  ghost  in  hell.  If  one  makes  a  donation  to 
the  Inexhaustible  Treasuries  in  her  name,  sutras  will  be  recited  for  her; 
she  will  be  delivered;  the  money,  in  the  meantime,  will  be  put  partly  to 
work  as  charity,  as  pure  gift,  but  partly,  too,  as  in  India,  as  interest- 
bearing  loans,  earmarked  for  specific  purposes  for  the  furtherance  of 
Buddhist  education,  ritual,  or  monastic  life. 

The  Chinese  Buddhist  approach  to  charity  was  nothing  if  not  mul- 
tifaceted.  Festivals  often  led  to  vast  outpourings  of  contributions,  with 
wealthy  adherents  vying  with  one  another  in  generosity,  often  driving 
their  entire  fortunes  to  the  monasteries,  in  the  forms  of  oxcarts  laden 
with  millions  of  strings  of  cash — a  kind  of  economic  self-immolation 
that  paralleled  the  spectacular  monastic  suicides.  Their  contributions 
swelled  the  Inexhaustible  Treasuries.  Some  would  be  given  to  the  needy, 
particularly  in  times  of  hardship.  Some  would  be  loaned.  One  practice 
that  hovered  between  charity  and  business  was  providing  peasants  with 
alternatives  to  the  local  moneylender.  Most  monasteries  had  attendant 
pawnshops  where  the  local  poor  could  place  some  valuable  posses- 
sion— a  robe,  a  couch,  a  mirror — in  hock  in  exchange  for  low-interest 
loans.40  Finally,  there  was  the  business  of  the  monastery  itself:  that  por- 
tion of  the  Inexhaustible  Treasury  turned  over  to  the  management  of 
lay  brothers,  and  either  put  out  at  loan  or  invested.  Since  monks  were 
not  allowed  to  eat  the  products  of  their  own  fields,  the  fruit  or  grain 
had  to  be  put  on  the  market,  further  swelling  monastic  revenues.  Most 



monasteries  came  to  be  surrounded  not  only  by  commercial  farms  but 
veritable  industrial  complexes  of  oil  presses,  flour  mills,  shops,  and 
hostels,  often  with  thousands  of  bonded  workers.41  At  the  same  time, 
the  Treasuries  themselves  became — as  Gernet  was  perhaps  the  first  to 
point  out — the  world's  first  genuine  forms  of  concentrated  finance  capi- 
tal. They  were,  after  all,  enormous  concentrations  of  wealth  managed 
by  what  were  in  effect  monastic  corporations,  which  were  constantly 
seeking  new  opportunities  for  profitable  investment.  They  even  shared 
the  quintessential  capitalist  imperative  of  continual  growth;  the  Trea- 
suries had  to  expand,  since  according  to  Mahayana  doctrine,  genu- 
ine liberation  would  not  be  possible  until  the  whole  world  embraced 
the  Dharma.42 

This  was  precisely  the  situation — huge  concentrations  of  capital  in- 
terested in  nothing  more  than  profit — that  Confucian  economic  policy 
was  supposed  to  prevent.  Still,  it  took  some  time  for  Chinese  govern- 
ments to  recognize  the  threat.  Government  attitudes  veered  back  and 
forth.  At  first,  especially  in  the  chaotic  years  of  the  early  Middle  Ages, 
monks  were  welcomed — even  given  generous  land  grants  and  provided 
with  convict  laborers  to  reclaim  forests  and  marshes,  and  tax-exempt 
status  for  their  business  enterprises.4'  A  few  emperors  converted,  and 
while  most  of  the  bureaucracy  kept  the  monks  at  arm's  length,  Bud- 
dhism became  especially  popular  with  court  women,  as  well  as  with 
eunuchs  and  many  scions  of  wealthy  families.  As  time  went  on,  though, 
administrators  turned  from  seeing  monks  as  a  boon  to  rural  society  to 
its  potential  ruination.  Already,  by  511  ad,  there  were  decrees  condemn- 
ing monks  for  diverting  grain  that  was  supposed  to  be  used  for  charita- 
ble purposes  to  high-interest  loans,  and  altering  debt  contracts — a  gov- 
ernment commission  had  to  be  appointed  to  review  the  accounts  and 
nullify  any  loans  in  which  interest  was  found  to  have  exceeded  princi- 
pal. In  713  ad  we  have  another  decree,  confiscating  two  Inexhaustible 
Treasuries  of  the  Three  Stages  sect,  whose  members  they  accused  of 
fraudulent  solicitation.44  Before  long  there  were  major  campaigns  of 
government  repression,  at  first  often  limited  to  certain  regions,  but  over 
time,  more  often  empire-wide.  During  the  most  severe,  carried  out  in 
845  ad,  a  total  of  4,600  monasteries  were  razed  along  with  their  shops 
and  mills,  260,000  monks  and  nuns  forcibly  defrocked  and  returned  to 
their  families — but  at  the  same  time,  according  to  government  reports, 
150,000  temple  serfs  released  from  bondage. 

Whatever  the  real  reasons  behind  the  waves  of  repression  (and 
these  were  no  doubt  many),  the  official  reason  was  always  the  same: 
a  need  to  restore  the  money  supply.  The  monasteries  were  becoming 



so  large,  and  so  rich,  administrators  insisted,  that  China  was  simply 
running  out  of  metal: 

The  great  repressions  of  Buddhism  under  the  Chou  emperor 
Wu  between  574  and  577,  under  Wu-tsung  in  842-845,  and 
finally  in  955,  presented  themselves  primarily  as  measures  of 
economic  recovery:  each  of  them  provided  an  opportunity 
for  the  imperial  government  to  procure  the  necessary  copper 
for  the  minting  of  new  coins.45 

One  reason  is  that  monks  appear  to  have  been  systematically  melt- 
ing down  strings  of  coins,  often  hundreds  of  thousands  at  a  time,  to 
build  colossal  copper  or  even  gilded  copper  statues  of  the  Buddha — 
along  with  other  objects  such  as  bells  and  copper  chimes,  or  even 
such  extravagances  as  mirrored  halls  or  gilded  copper  roof  tiles.  The 
result,  according  to  official  commissions  of  inquiry,  was  economi- 
cally disastrous:  the  price  of  metals  would  soar,  coinage  disappear, 
and  rural  marketplaces  cease  to  function,  even  as  those  rural  people 
whose  children  had  not  become  monks  often  fell  deeper  into  debt  to 
the  monasteries. 

It  perhaps  stands  to  reason  that  Chinese  Buddhism,  a  religion  of  mer- 
chants that  then  took  popular  roots,  should  have  developed  in  this  di- 
rection: a  genuine  theology  of  debt,  even  perhaps  a  practice  of  absolute 
self-sacrifice,  of  abandoning  everything,  one's  fortune  or  even  one's  life, 
that  ultimately  led  to  collectively  managed  finance  capital.  The  reason 
that  the  result  seems  so  weird,  so  full  of  paradoxes,  is  that  it  is  again 
an  attempt  to  apply  the  logic  of  exchange  to  questions  of  Eternity. 

Recall  an  idea  from  earlier  in  the  book:  exchange,  unless  it's  an 
instantaneous  cash  transaction,  creates  debts.  Debts  linger  over  time.  If 
you  imagine  all  human  relations  as  exchange,  then  insofar  as  people  do 
have  ongoing  relations  with  one  another,  those  relations  are  laced  with 
debt  and  sin.  The  only  way  out  is  to  annihilate  the  debt,  but  then  social 
relations  vanish  too.  This  is  quite  in  accord  with  Buddhism,  whose  ul- 
timate aim  is  indeed  the  attainment  of  "emptiness,"  absolute  liberation, 
the  annihilation  of  all  human  and  material  attachments,  since  these  are 
all  ultimately  causes  of  suffering.  For  Mahayana  Buddhists,  however, 
absolute  liberation  cannot  be  achieved  by  any  one  being  independently; 
the  liberation  of  each  depends  on  all  the  others;  therefore,  until  the  end 
of  time,  such  matters  are  in  a  certain  sense  always  in  suspension. 



In  the  meantime,  exchange  dominates:  "One  purchases  felicity,  and 
sells  one's  sins,  just  as  in  commercial  operations."  Even  acts  of  charity 
and  self-sacrifice  are  not  purely  generous;  one  is  purchasing  "merit" 
from  the  bodhisattvas.4*  The  notion  of  infinite  debt  comes  in  when  this 
logic  slams  up  against  the  Absolute,  or,  one  might  perhaps  better  say, 
against  something  that  utterly  defies  the  logic  of  exchange.  Because 
there  are  things  that  do.  This  would  explain,  for  instance,  the  odd  urge 
to  first  quantify  the  exact  amount  of  milk  one  has  absorbed  at  one's 
mother's  breast,  and  then  to  say  that  there  is  no  conceivable  way  to 
repay  it.  Exchange  implies  interaction  between  equivalent  beings.  Your 
mother,  on  the  other  hand,  is  not  an  equivalent  being.  She  created 
you  out  of  her  own  flesh.  This  is  exactly  the  point  that  I  suggested 
the  Vedic  authors  were  subtly  trying  to  make  when  they  talked  about 
"debts"  to  the  gods:  of  course  you  cannot  really  "pay  your  debt  to  the 
universe" — that  would  imply  that  (i)  you  and  (2)  everything  that  exists 
(including  you)  are  in  some  sense  equivalent  entities.  This  is  clearly 
absurd.  The  closest  you  can  come  to  repayment  is  to  simply  recognize 
that  fact.  Such  recognition  is  the  true  meaning  of  sacrifice.  Like  Ros- 
pabe's  original  money,  a  sacrificial  offering  is  not  a  way  to  pay  a  debt, 
but  a  way  to  acknowledge  the  impossibility  of  the  idea  that  there  could 
ever  be  repayment: 

The  parallel  was  not  missed  in  certain  mythological  traditions. 
According  to  one  famous  Hindu  myth,  two  gods,  the  brothers 
Kartikeya  and  Ganesha,  had  a  quarrel  over  who  should  be 
the  first  to  marry.  Their  mother  Parvati  suggested  a  contest: 
the  winner  would  be  the  one  to  most  quickly  circle  the  entire 
universe.  Kartikeya  set  off  on  the  back  of  a  giant  peacock.  It 
took  him  three  years  to  transverse  the  limits  of  the  cosmos. 
Ganesha  bided  his  time,  then,  finally,  walked  in  a  circle  around 
his  mother,  remarking,  "You  are  the  universe  to  me." 

I've  also  argued  that  any  system  of  exchange  is  always  necessarily 
founded  on  something  else,  something  that,  in  its  social  manifesta- 
tion at  least,  is  ultimately  communism.  With  all  those  things  that  we 
treat  as  eternal,  that  we  assume  will  always  be  there — our  mother's 
love,  true  friendship,  sociality,  humanity,  belonging,  the  existence  of 
the  cosmos — no  calculation  is  necessary,  or  even  ultimately  possible; 
insofar  as  there  is  give  and  take,  they  follow  completely  different  prin- 
ciples. What,  then,  happens  to  such  absolute  and  unlimited  phenomena 
when  one  tries  to  imagine  the  world  as  a  set  of  transactions — as  ex- 
change? Generally,  one  of  two  things.  We  either  ignore  or  deify  them. 



(Mothers,  and  caregiving  women  in  general,  are  a  classic  case  in  point.) 
Or  we  do  both.  What  we  treat  as  eternal  in  our  actual  relations  with 
one  another  vanishes  and  reappears  as  an  abstraction,  an  absolute.47 
In  the  case  of  Buddhism,  this  was  framed  as  the  inexhaustible  merit 
of  bodhisatt-vas,  who  exist,  in  a  certain  sense,  outside  of  time.  They 
are  at  once  the  model  for  the  Inexhaustible  Treasuries,  and  also  their 
practical  foundation:  one  can  only  repay  one's  endless  karmic  debt, 
or  one's  infinite  milk-debt,  by  drawing  on  this  equally  infinite  pool  of 
redemption,  which,  in  turn,  becomes  the  basis  for  the  actual  material 
funds  of  the  monasteries,  which  are'  equally  eternal — a  pragmatic  form 
of  communism,  in  fact,  since  they  were  vast  pools  of  wealth  collec- 
tively owned  and  collectively  managed:  the  center  of  vast  projects  of 
human  cooperation,  which  were  assumed  to  be  similarly  eternal.  Yet  at 
the  same  time — here  I  think  Gernet  is  right — this  communism  became 
the  basis,  in  turn,  of  something  very  much  like  capitalism.  The  rea- 
son was,  above  all,  the  need  for  constant  expansion.  Everything — even 
charity — was  an  opportunity  to  proselytize;  the  Dharma  had  to  grow, 
ultimately,  to  encompass  everyone  and  everything,  in  order  to  effect  the 
salvation  of  all  living  beings. 

The  Middle  Ages  were  marked  by  a  general  move  toward  abstraction: 
real  gold  and  silver  ended  up  largely  in  churches,  monasteries,  and 
temples,  money  became  virtual  again,  and  at  the  same  time,  the  ten- 
dency everywhere  was  to  set  up  overarching  moral  institutions  meant 
to  regulate  the  process  and,  in  particular,  to  establish  certain  protec- 
tions for  debtors. 

China  was  unusual  in  that  it  was  one  place  where  an  Axial  Age 
empire  managed  to  survive — though  at  first,  only  barely.  Chinese  gov- 
ernments did  manage  to  keep  coins  in  circulation  in  most  places  most 
of  the  time.  This  was  made  easier  by  their  reliance  exclusively  on 
small-denomination  coins  made  of  bronze.  Even  so,  it  clearly  took 
enormous  efforts. 

As  usual,  we  don't  know  a  lot  about  how  everyday  economic 
transactions  took  place,  but  what  we  do  know  suggests  that  in  small- 
scale  transactions,  coins  were  probably  most  often  used  in  dealing  with 
strangers.  As  elsewhere,  local  shopkeepers  and  merchants  extended 
credit.  Most  accounts  seem  to  have  been  kept  through  the  use  of  tally 
sticks,  strikingly  similar  to  those  used  in  England,  except  that  rather 
than  hazelwood  they  were  usually  made  of  a  split  piece  of  notched 
bamboo.  Here,  too,  the  creditor  took  one  half,  and  the  debtor  held  the 



other;  they  were  joined  at  the  moment  of  repayment,  and  often  broken 
afterward  to  mark  the  cancellation  of  the  debt.48  To  what  degree  were 
they  transferable?  We  don't  really  know.  Most  of  what  we  do  know  is 
from  casual  references  in  texts  that  are  mainly  about  something  else: 
anecdotes,  jokes,  and  poetic  allusions.  The  great  collection  of  Taoist 
wisdom,  the  Leizi,  probably  written  during  the  Han  dynasty,  contains 
one  such: 

There  was  a  man  of  Sung  who  was  strolling  in  the  street  and 
picked  up  a  half  tally  someone  had  lost.  He  took  it  home 
and  stored  it  away,  and  secretly  counted  the  indentations  of 
the  broken  edge.  He  told  a  neighbor:  "I  shall  be  rich  any  day 

Rather  like  someone  who  finds  a  key  and  figures  "just  as  soon  as  I 
can  figure  out  which  lock  .  .  ."50  Another  story  tells  of  how  Liu  Bang, 
a  bibulous  local  constable  and  future  founder  of  the  Han  dynasty, 
used  to  go  on  all-night  drinking  binges,  running  up  enormous  tabs. 
Once,  while  he  lay  collapsed  in  a  drunken  stupor  in  a  wine-shop,  the 
owner  saw  a  dragon  hovering  over  his  head — a  sure  sign  of  future 
greatness — and  immediately  "broke  the  tally,"  forgiving  him  his  ac- 
cumulated drinking  debts.51 

Tallies  weren't  just  used  for  loans,  but  for  any  sort  of  contract — 
which  is  why  early  paper  contracts  also  had  to  be  cut  in  half  and  one 
half  kept  by  each  party.52  With  paper  contracts,  there  was  a  definite 
tendency  for  the  creditor's  half  to  function  as  an  IOU  and  thus  be- 
come transferable.  By  806  ad,  for  instance,  right  around  the  apogee 
of  Chinese  Buddhism,  merchants  moving  tea  over  long  distances  from 
the  far  south  of  the  country  and  officials  transporting  tax  payments  to 
the  capital,  all  of  them  concerned  with  the  dangers  of  carrying  bullion 
over  long  distances,  began  to  deposit  their  money  with  bankers  in  the 
capital  and  devised  a  system  of  promissory  notes.  They  were  called 
"Flying  Cash,"  also  divided  in  half,  like  tallies,  and  redeemable  for 
cash  in  their  branches  in  the  provinces.  They  quickly  started  passing 
from  hand  to  hand  and  operated  something  like  currency.  The  govern- 
ment first  tried  to  forbid  their  use,  then  a  year  or  two  later — and  this 
became  a  familiar  pattern  in  China — when  it  realized  that  it  could  not 
suppress  them,  switched  gears  and  established  a  bureau  empowered  to 
issue  such  notes  themselves.53 

By  the  early  Song  dynasty  (960-1279  ad),  local  banking  operations 
all  over  China  were  running  similar  operations,  accepting  cash  and 
bullion  for  safekeeping  and  allowing  depositors  to  use  their  receipts  as 



promissory  notes,  as  well  as  trading  in  government  coupons  for  salt 
and  tea.  Many  of  these  notes  came  to  circulate  as  de  facto  money.54 
The  government,  as  usual,  first  tried  to  ban  the  practice,  then  control 
it  (granting  a  monopoly  to  sixteen  leading  merchants),  then,  finally,  set 
up  a  government  monopoly — the  Bureau  of  Exchange  Medium,  estab- 
lished in  1023 — and  before  long,  aided  by  the  newly  invented  printing 
press,  was  operating  factories  in  several  cities  employing  thousands  of 
workers  and  producing  literally  millions  of  notes.55 

At  first,  this  paper  money  was  meant  to  circulate  for  a  limited  time 
(notes  would  expire  after  two,  then  three,  then  seven  years),  and  was 
redeemable  in  bullion.  Over  time,  especially  as  the  Song  came  under 
increasing  military  pressure,  the  temptation  to  simply  print  money  with 
little  or  no  backup  became  overwhelming — and,  moreover,  Chinese 
governments  were  rarely  completely  willing  to  accept  their  own  pa- 
per money  for  tax  purposes.  Combine  this  with  the  fact  that  the  bills 
were  worthless  outside  China,  and  it's  rather  surprising  that  the  system 
worked  at  all.  Certainly,  inflation  was  a  constant  problem  and  the 
money  would  have  to  be  recalled  and  reissued.  Occasionally  the  whole 
system  would  break  down,  but  then  people  would  resort  to  their  own 
expedients:  "privately  issued  tea  checks,  noodle  checks,  bamboo  tallies, 
wine  tallies,  etc."56  Still,  the  Mongols,  who  ruled  China  from  1271  to 
1368  ad,  chose  to  maintain  the  system,  and  it  was  only  abandoned  in 
the  seventeenth  century. 

This  is  important  to  note  because  the  conventional  account  tends 
to  represent  China's  experiment  with  paper  money  as  a  failure,  even, 
for  Metallists,  proof  that  "fiat  money,"  backed  only  by  state  power, 
will  always  eventually  collapse.57  This  is  especially  odd,  since  the  cen- 
turies when  paper  money  was  in  use  are  usually  considered  the  most 
economically  dynamic  in  Chinese  history.  Surely,  if  the  United  States 
government  was  eventually  forced  to  abandon  the  use  of  federal  re- 
serve notes  in  2400  ad,  no  one  would  be  arguing  that  this  showed  that 
the  very  idea  was  always  intrinsically  unworkable.  Nonetheless,  the 
main  point  I'd  like  to  emphasize  here  is  that  terms  like  "fiat  money," 
however  common,  are  deceptive.  Almost  all  of  the  new  forms  of  paper 
money  that  emerged  were  not  originally  created  by  governments  at 
all;  they  were  simply  ways  of  recognizing  and  expanding  the  use  of 
credit  instruments  that  emerged  from  everyday  economic  transactions. 
If  it  was  only  China  that  developed  paper  money  in  the  Middle  Ages, 
this  was  largely  because  only  in  China  was  there  a  government  large 
and  powerful  enough,  but  also,  sufficiently  suspicious  of  its  mercantile 
classes,  to  feel  it  had  to  take  charge  of  such  operations. 



The  Near  West: 
Islam  (Capital  as  Credit) 

Prices  depend  on  the  will  of  Allah;  it  is 
he  who  raises  and  lowers  them. 

— Attributed  to  the 
Prophet  Mohammed 

The  profit  of  each  partner  must  be  in 
proportion  to  the  share  of  each  in  the 

Islamic  legal  precept 

For  most  of  the  Middle  Ages,  the  economic  nerve  center  of  the  world 
economy  and  the  source  of  its  most  dramatic  financial  innovations  was 
neither  China  nor  India,  but  the  West,  which,  from  the  perspective  of 
the  rest  of  the  world,  meant  the  world  of  Islam.  During  most  of  this 
period,  Christendom,  lodged  in  the  declining  empire  of  Byzantium  and 
the  obscure  semi-barbarous  principalities  of  Europe,  was  largely  insig- 

Since  people  who  live  in  Western  Europe  have  so  long  been  in 
the  habit  of  thinking  of  Islam  as  the  very  definition  of  "the  East," 
it's  easy  to  forget  that,  from  the  perspective  of  any  other  great  tradi- 
tion, the  difference  between  Christianity  and  Islam  is  almost  negligible. 
One  need  only  pick  up  a  book  on,  say,  Medieval  Islamic  philosophy 
to  discover  disputes  between  the  Baghdad  Aristoteleans  and  the  neo- 
Pythagoreans  in  Basra,  or  Persian  Neo-Platonists — essentially,  scholars 
doing  the  same  work  of  trying  to  square  the  revealed  religion  tradi- 
tion beginning  with  Abraham  and  Moses  with  the  categories  of  Greek 
philosophy,  and  doing  so  in  a  larger  context  of  mercantile  capitalism, 
universalistic  missionary  religion,  scientific  rationalism,  poetic  celebra- 
tions of  romantic  love,  and  periodic  waves  of  fascination  with  mystical 
wisdom  from  the  East. 

From  a  world-historical  perspective,  it  seems  much  more  sensible 
to  see  Judaism,  Christianity,  and  Islam  as  three  different  manifestations 
of  the  same  great  Western  intellectual  tradition,  which  for  most  of 
human  history  has  centered  on  Mesopotamia  and  the  Levant,  extend- 
ing into  Europe  as  far  as  Greece  and  into  Africa  as  far  as  Egypt,  and 
sometimes  farther  west  across  the  Mediterranean  or  down  the  Nile. 
Economically,  most  of  Europe  was  until  perhaps  the  High  Middle  Ages 



in  exactly  the  same  situation  as  most  of  Africa:  plugged  into  the  larger 
world  economy,  if  at  all,  largely  as  an  exporter  of  slaves,  raw  materials, 
and  the  occasional  exotica  (amber,  elephant  tusks  .  .  .),  and  importer 
of  manufactured  goods  (Chinese  silks  and  porcelain,  Indian  calicoes, 
Arab  steel).  To  get  a  sense  of  comparative  economic  development  (even 
if  the  examples  are  somewhat  scattered  over  time),  consider  the  fol- 
lowing table:58 

Populations  and  Tax  Revenue,  350  BC-1200  AD 

Population  Revenue  Revenue 

per  Head 

Millions  Tons  of  Silver  Grams  of  Silver 

Persia,  c.  BC  350                 17  697  41 

Egypt,  c.  BC  200                  7  384  55 

Rome,  c.  1  AD                    50  825  17 

Rome,  c.  150  AD                 50  1,050  21 

Byzantium,  c.  850  AD          10  150  15 

Abbasids,  c.  850  AD            26  1,260  48 

T'ang,  c.  850  AD                50  2,145  43 

France,  1221  AD                  8.5  20.3  2.4 

England,  1203  AD               2.5  11.5  4.6 

What's  more,  for  most  of  the  Middle  Ages,  Islam  was  not  only  the 
core  of  Western  civilization;  it  was  its  expansive  edge,  working  its  way 
into  India,  expanding  in  Africa  and  Europe,  sending  missionaries  and 
winning  converts  across  the  Indian  Ocean. 

The  prevailing  Islamic  attitude  toward  law,  government,  and  eco- 
nomic matters  was  the  exact  opposite  of  that  prevalent  in  China.  Con- 
fucians were  suspicious  of  governance  through  strict  codes  of  law, 
preferring  to  rely  on  the  inherent  sense  of  justice  of  the  cultivated 
scholar — a  scholar  who  was  simply  assumed  to  also  be  a  government 
official.  Medieval  Islam,  on  the  other  hand,  enthusiastically  embraced 
law,  which  was  seen  as  a  religious  institution  derived  from  the  Prophet, 
but  tended  to  view  government,  more  often  than  not,  as  an  unfortunate 
necessity,  an  institution  that  the  truly  pious  would  do  better  to  avoid.59 

In  part  this  was  because  of  the  peculiar  nature  of  Islamic  govern- 
ment. The  Arab  military  leaders  who,  after  Mohammed's  death  in 
632  ad,  conquered  the  Sassanian  empire  and  established  the  Abbasid 
Caliphate,  always  continued  to  see  themselves  as  people  of  the  desert, 



and  never  felt  entirely  part  of  the  urban  civilizations  they  had  come 
to  rule.  This  discomfort  was  never  quite  overcome — on  either  side. 
It  took  the  bulk  of  the  population  several  centuries  to  convert  to  the 
conqueror's  religion,  and  even  when  they  did,  they  never  seem  to  have 
really  identified  with  their  rulers.  Government  was  seen  as  military 
power — necessary,  perhaps,  defend  the  faith,  but  fundamentally  exte- 
rior to  society. 

In  part,  too,  it  was  because  of  the  peculiar  alliance  between  mer- 
chants and  common  folk  that  came  to  be  aligned  against  them.  After 
Caliph  al-Ma'mum's  abortive  attempt  to  set  up  a  theocracy  in  832  ad, 
the  government  took  a  hands-off  position  on  questions  of  religion.  The 
various  schools  of  Islamic  law  were  free  to  create  their  own  educational 
institutions  and  maintain  their  own  separate  system  of  religious  justice. 
Crucially,  it  was  the  ulema,  the  legal  scholars,  who  were  the  principal 
agents  in  the  conversion  of  the  bulk  of  the  empire's  population  to  Islam 
in  Mesopotamia,  Syria,  Egypt,  and  North  Africa  in  those  same  years.60 
But — like  the  elders  in  charge  of  guilds,  civic  associations,  commercial 
sodalities,  and  religious  brotherhoods — they  did  their  best  to  keep  the 
government,  with  its  armies  and  ostentation,  at  arm's  length.61  "The 
best  princes  are  those  who  visit  religious  teachers,"  one  proverb  put 
it,  "the  worst  religious  teachers  are  the  those  who  allow  themselves  to 
be  visited  by  princes."62  A  Medieval  Turkish  story  brings  it  home  even 
more  pointedly: 

The  king  once  summoned  Nasruddin  to  court. 

"Tell  me,"  said  the  king,  "you  are  a  mystic,  a  philosopher, 
a  man  of  unconventional  understandings.  I  have  become  in- 
terested in  the  issue  of  value.  It's  an  interesting  philosophical 
question.  How  does  one  establish  the  true  worth  of  a  person, 
or  an  object?  Take  me  for  example.  If  I  were  to  ask  you  to 
estimate  my  value,  what  would  you  say?" 

"Oh,"  Nasruddin  said,  "I'd  say  about  two  hundred  dinars." 

The  emperor  was  flabbergasted.  "What?!  But  this  belt  I'm 
wearing  is  worth  two  hundred  dinars!" 

"I  know,"  said  Nasruddin.  "Actually,  I  was  taking  the  value 
of  the  belt  into  consideration." 

This  disjuncture  had  profound  economic  effects.  It  meant  that  the 
Caliphate,  and  later  Muslim  empires,  could  operate  in  many  ways 
much  like  the  old  Axial  Age  empires — creating  professional  armies, 
waging  wars  of  conquest,  capturing  slaves,  melting  down  loot  and 
distributing  it  in  the  form  of  coins  to  soldiers  and  officials,  demanding 



that  those  coins  be  rendered  back  as  taxes — but  at  the  same  time,  with- 
out having  nearly  the  same  effects  on  ordinary  people's  lives. 

Over  the  course  of  the  wars  of  expansion,  for  example,  enormous 
quantities  of  gold  and  silver  were  indeed  looted  from  palaces,  temples, 
and  monasteries  and  stamped  into  coinage,  allowing  the  Caliphate  to 
produce  gold  dinars  and  silver  dirhams  of  remarkable  purity — that  is, 
with  next  to  no  fiduciary  element,  the  value  of  each  coin  corresponding 
almost  precisely  to  its  weight  in  precious  metal.63  As  a  result,  they  were 
able  to  pay  their  troops  extraordinarily  well.  A  soldier  in  the  Caliph's 
army,  for  example,  received  almost  four  times  the  wages  once  received 
by  a  Roman  legionary.64  We  can,  perhaps,  speak  of  a  kind  of  "military- 
coinage-slavery"  complex  here — but  it  existed  in  a  kind  of  bubble. 
Wars  of  expansion,  and  trade  with  Europe  and  Africa,  did  produce  a 
fairly  constant  flow  of  slaves,  but  in  dramatic  contrast  to  the  ancient 
world,  very  few  of  them  ended  up  laboring  in  farms  or  workshops. 
Most  ended  up  as  decoration  in  the  houses  of  the  rich,  or,  increasingly 
over  time,  as  soldiers.  Over  the  course  of  the  Abbasid  dynasty  (750- 
1258  ad)  in  fact,  the  empire  came  to  rely,  for  its  military  forces,  almost 
exclusively  on  Mamluks,  highly  trained  military  slaves  captured  or 
purchased  from  the  Turkish  steppes.  The  policy  of  employing  slaves  as 
soldiers  was  maintained  by  all  of  the  Islamic  successor  states,  includ- 
ing the  Mughals,  and  culminated  in  the  famous  Mamluk  sultanate  in 
Egypt  in  the  thirteenth  century,  but  historically,  it  was  unprecedented.65 
In  most  times  and  places  slaves  are,  for  obvious  reasons,  the  very  last 
people  to  be  allowed  anywhere  near  weapons.  Here  it  was  systematic. 
But  in  a  strange  way,  it  also  made  perfect  sense:  if  slaves  are,  by  defini- 
tion, people  who  have  been  severed  from  society,  this  was  the  logical 
consequence  of  the  wall  created  between  society  and  the  Medieval 
Islamic  state.66 

Religious  teachers  appear  to  have  done  everything  they  could  to 
prop  up  the  wall.  One  reason  for  the  recourse  to  slave  soldiers  was  their 
tendency  to  discourage  the  faithful  from  serving  in  the  military  (since  it 
might  mean  fighting  fellow  believers).  The  legal  system  that  they  created 
also  ensured  that  it  was  effectively  impossible  for  Muslims — or  for  that 
matter  Christian  or  Jewish  subjects  of  the  Caliphate — to  be  reduced  to 
slavery.  Here  al-Wahid  seems  to  have  been  largely  correct.  Islamic  law 
took  aim  at  just  about  all  the  most  notorious  abuses  of  earlier,  Axial 
Age  societies.  Slavery  through  kidnapping,  judicial  punishment,  debt, 
and  the  exposure  or  sale  of  children,  even  through  the  voluntary  sale 
of  one's  own  person — all  were  forbidden,  or  rendered  unenforceable.67 
Likewise  with  all  the  other  forms  of  debt  peonage  that  had  loomed 
over  the  heads  of  poor  Middle  Eastern  farmers  and  their  families 



since  the  dawn  of  recorded  history.  Finally,  Islam  strictly  forbade  usu- 
ry, which  it  interpreted  to  mean  any  arrangement  in  which  money 
or  a  commodity  was  lent  at  interest,  for  any  purpose  whatsoever.68 

In  a  way,  one  can  see  the  establishment  of  Islamic  courts  as  the 
ultimate  triumph  of  the  patriarchal  rebellion  that  had  begun  so  many 
thousands  of  years  before:  of  the  ethos  of  the  desert  or  the  steppe, 
real  or  imagined,  even  as  the  faithful  did  their  best  to  keep  the  heavily 
armed  descendants  of  actual  nomads  confined  to  their  camps  and  pal- 
aces. It  was  made  possible  by  a  profound  shift  in  class  alliances.  The 
great  urban  civilizations  of  the  Middle  East  had  always  been  dominat- 
ed by  a  de  facto  alliance  between  administrators  and  merchants,  both 
of  whom  kept  the  rest  of  the  population  either  in  debt  peonage  or  in 
constant  peril  of  falling  into  it.  In  converting  to  Islam,  the  commercial 
classes,  so  long  the  arch-villains  in  the  eyes  of  ordinary  farmers  and 
townsfolk,  effectively  agreed  to  change  sides,  abandon  all  their  most 
hated  practices,  and  become  instead  the  leaders  of  a  society  that  now 
defined  itself  against  the  state. 

It  was  possible  because  from  the  beginning,  Islam  had  a  positive 
view  toward  commerce.  Mohammed  himself  had  begun  his  adult  life  as 
a  merchant;  and  no  Islamic  thinker  ever  treated  the  honest  pursuit  of 
profit  as  itself  intrinsically  immoral  or  inimical  to  faith.  Neither  did  the 
prohibitions  against  usury — which  for  the  most  part  were  scrupulously 
enforced,  even  in  the  case  of  commercial  loans — in  any  sense  mitigate 
against  the  growth  of  commerce,  or  even  the  development  of  complex 
credit  instruments.69  To  the  contrary,  the  early  centuries  of  the  Caliph- 
ate saw  an  immediate  efflorescence  in  both. 

Profits  were  still  possible  because  Islamic  jurists  were  careful  to 
allow  for  certain  service  fees,  and  other  considerations — notably,  al- 
lowing goods  bought  on  credit  to  be  priced  slightly  higher  than  those 
bought  for  cash — that  ensured  that  bankers  and  traders  still  had  an 
incentive  to  provide  credit  services.70  Still,  these  incentives  were  never 
enough  to  allow  banking  to  become  a  full-time  occupation:  instead, 
almost  any  merchant  operating  on  a  sufficiently  large  scale  could  be 
expected  to  combine  banking  with  a  host  of  other  moneymaking  activi- 
ties. As  a  result,  credit  instruments  soon  became  so  essential  to  trade 
that  almost  anyone  of  prominence  was  expected  to  keep  most  of  his 
or  her  wealth  on  deposit,  and  to  make  everyday  transactions,  not  by 
counting  out  coins,  but  by  inkpot  and  paper.  Promissory  notes  were 
called  sakk,  "checks",  or  ruq'a,  "notes."  Checks  could  bounce.  One 
German  historian,  picking  through  a  multitude  of  old  Arabic  literary 
sources,  recounts  that: 



About  900  a  great  man  paid  a  poet  in  this  way,  only  the  banker 
refused  the  check,  so  that  the  disappointed  poet  composed  a 
verse  to  the  effect  that  he  would  gladly  pay  a  million  on  the 
same  plan.  A  patron  of  the  same  poet  and  singer  (936)  dur- 
ing a  concert  wrote  a  check  in  his  favor  on  a  banker  for  five 
hundred  dinars.  When  paying,  the  banker  gave  the  poet  to  un- 
derstand that  it  was  customary  to  charge  one  dirham  discount 
on  each  dinar,  i.e.,  about  ten  per  cent.  Only  if  the  poet  would 
spend  the  afternoon  and  evening  with  him,  he  would  make  no 
deduction  .  .  . 

By  about  1000  the  banker  had  made  himself  indispensable  in 
Basra:  every  trader  had  his  banking  account,  and  paid  only  in 
checks  on  his  bank  in  the  bazaar.  .  .  .71 

Checks  could  be  countersigned  and  transferred,  and  letters  of  cred- 
it {suftaja)  could  travel  across  the  Indian  Ocean  or  the  Sahara.72  If  they 
did  not  turn  into  de  facto  paper  money,  it  was  because,  since  they  oper- 
ated completely  independent  of  the  state  (they  could  not  be  used  to  pay 
taxes,  for  instance),  their  value  was  based  almost  entirely  on  trust  and 
reputation.73  Appeal  to  the  Islamic  courts  was  generally  voluntary  or 
mediated  by  merchant  guilds  and  civic  associations.  In  such  a  context, 
having  a  famous  poet  compose  verses  making  fun  of  you  for  bouncing 
a  check  was  probably  the  ultimate  disaster. 

When  it  came  to  finance,  instead  of  interest-bearing  investments, 
the  preferred  approach  was  partnerships,  where  (often)  one  party 
would  supply  the  capital,  the  other  carry  out  the  enterprise.  Instead 
of  fixed  return,  the  investor  would  receive  a  share  of  the  profits.  Even 
labor  arrangements  were  often  organized  on  a  profit-sharing  basis.74 
In  all  such  matters,  reputation  was  crucial — in  fact,  one  lively  debate 
in  early  commercial  law  was  over  the  question  of  whether  reputation 
could  (like  land,  labor,  money,  or  other  resources)  itself  be  consid- 
ered a  form  of  capital.  It  sometimes  happened  that  merchants  would 
form  partnerships  with  no  capital  at  all,  but  only  their  good  names. 
This  was  called  "partnership  of  good  reputation."  As  one  legal  scholar 

As  for  the  credit  partnership,  it  is  also  called  the  "partnership 
of  the  penniless"  (sharika  al-mafalis).  It  comes  about  when  two 
people  form  a  partnership  without  any  capital  in  order  to  buy 
on  credit  and  then  sell.  It  is  designated  by  this  name  partner- 
ship of  good  reputations  because  their  capital  consists  of  their 



status  and  good  reputations;  for  credit  is  extended  only  to  him 
who  has  a  good  reputation  among  people.75 

Some  legal  scholars  objected  to  the  idea  that  such  a  contract  could 
be  considered  legally  binding,  since  it  was  not  based  on  an  initial  out- 
lay of  material  capital;  others  considered  it  legitimate,  provided  the 
partners  make  an  equitable  partition  of  the  profits — since  reputation 
cannot  be  quantified.  The  remarkable  thing  here  is  the  tacit  recog- 
nition that,  in  a  credit  economy  that  operates  largely  without  state 
mechanisms  of  enforcement  (without  police  to  arrest  those  who  com- 
mit fraud,  or  bailiffs  to  seize  a  debtor's  property),  a  significant  part  of 
the  value  of  a  promissory  note  is  indeed  the  good  name  of  the  signa- 
tory. As  Pierre  Bourdieu  was  later  to  point  out  in  describing  a  similar 
economy  of  trust  in  contemporary  Algeria:  it's  quite  possible  to  turn 
honor  into  money,  almost  impossible  to  convert  money  into  honor.76 

These  networks  of  trust,  in  turn,  were  largely  responsible  for  the 
spread  of  Islam  over  the  caravan  routes  of  Central  Asia  and  the  Sahara, 
and  especially  across  the  Indian  Ocean,  the  main  conduit  of  Medieval 
world  trade.  Over  the  course  of  the  Middle  Ages,  the  Indian  Ocean  ef- 
fectively became  a  Muslim  lake.  Muslim  traders  appear  to  have  played 
a  key  role  in  establishing  the  principle  that  kings  and  their  armies 
should  keep  their  quarrels  on  dry  land;  the  seas  were  to  be  a  zone  of 
peaceful  commerce.  At  the  same  time,  Islam  gained  a  toehold  in  trade 
emporia  from  Aden  to  the  Moluccas  because  Islamic  courts  were  so 
perfectly  suited  to  provide  those  functions  that  made  such  ports  at- 
tractive: means  of  establishing  contracts,  recovering  debts,  creating  a 
banking  sector  capable  of  redeeming  or  transferring  letters  of  credit.77 
The  level  of  trust  thereby  created  between  merchants  in  the  great  Ma- 
lay entrepot  Malacca,  gateway  to  the  spice  islands  of  Indonesia,  was 
legendary.  The  city  had  Swahili,  Arab,  Egyptian,  Ethiopian,  and  Arme- 
nian quarters,  as  well  as  quarters  for  merchants  from  different  regions 
of  India,  China,  and  Southeast  Asia.  Yet  it  was  said  that  its  merchants 
shunned  enforceable  contracts,  preferring  to  seal  transactions  "with  a 
handshake  and  a  glance  at  heaven."78 

In  Islamic  society,  the  merchant  became  not  just  a  respected  figure, 
but  a  kind  of  paragon:  like  the  warrior,  a  man  of  honor  able  to  pursue 
far-flung  adventures;  unlike  him,  able  to  do  so  in  a  fashion  damaging 
to  no  one.  The  French  historian  Maurice  Lombard  draws  a  striking, 
if  perhaps  rather  idealized,  picture  of  him  "in  his  stately  town-house, 
surrounded  by  slaves  and  hangers-on,  in  the  midst  of  his  collections  of 
books,  travel  souvenirs,  and  rare  ornaments,"  along  with  his  ledgers, 
correspondence,  and  letters  of  credit,  skilled  in  the  arts  of  double-entry 



book-keeping  along  with  secret  codes  and  ciphers,  giving  alms  to  the 
poor,  supporting  places  of  worship,  perhaps,  dedicating  himself  to  the 
writing  of  poetry,  while  still  able  to  translate  his  general  creditworthi- 
ness into  great  capital  reserves  by  appealing  to  family  and  partners.79 
Lombard's  picture  is  to  some  degree  inspired  by  the  famous  Thousand 
and  One  Nights  description  of  Sindbad,  who,  having  spent  his  youth 
in  perilous  mercantile  ventures  to  faraway  lands,  finally  retired,  rich 
beyond  dreams,  to  spend  the  rest  of  his  life  amidst  gardens  and  dancing 
girls,  telling  tall  tales  of  his  adventures.  Here's  a  glimpse,  from  the  eyes 
of  a  humble  porter  (also  named  Sindbad)  when  first  summoned  to  see 
him  by  the  master's  page: 

He  found  it  to  be  a  goodly  mansion,  radiant  and  full  of  majes- 
ty, till  he  brought  him  to  a  grand  sitting  room  wherein  he  saw 
a  company  of  nobles  and  great  lords  seated  at  tables  garnished 
with  all  manner  of  flowers  and  sweet-scented  herbs,  besides 
great  plenty  of  dainty  viands  and  fruits  dried  and  fresh  and 
confections  and  wines  of  the  choicest  vintages.  There  also  were 
instruments  of  music  and  mirth  and  lovely  slave  girls  playing 
and  singing.  All  the  company  was  ranged  according  to  rank, 
and  in  the  highest  place  sat  a  man  of  worshipful  and  noble 
aspect  whose  bearded  sides  hoariness  had  stricken,  and  he  was 
stately  of  stature  and  fair  of  favor,  agreeable  of  aspect  and 
full  of  gravity  and  dignity  and  majesty.  So  Sindbad  the  Porter 
was  confounded  at  that  which  he  beheld  and  said  in  himself, 
"By  Allah,  this  must  be  either  some  king's  palace,  or  a  piece 
of  Paradise!"80 

It's  worth  quoting  not  only  because  it  represents  a  certain  ideal,  a 
picture  of  the  perfect  life,  but  because  there's  no  real  Christian  parallel. 
It  would  be  impossible  conceive  of  such  an  image  appearing  in,  say,  a 
Medieval  French  romance. 

The  veneration  of  the  merchant  was  matched  by  what  can  only  be 
called  the  world's  first  popular  free-market  ideology.  True,  one  should 
be  careful  not  to  confuse  ideals  with  reality.  Markets  were  ever  entirely 
independent  from  the  government.  Islamic  regimes  did  employ  all  the 
usual  strategies  of  manipulating  tax  policy  to  encourage  the  growth  of 
markets,  and  they  periodically  tried  to  intervene  in  commercial  law.8' 
Still,  there  was  a  very  strong  popular  feeling  that  they  shouldn't.  Once 
freed  from  its  ancient  scourges  of  debt  and  slavery,  the  local  bazaar  had 
become,  for  most,  not  a  place  of  moral  danger,  but  the  very  opposite: 



the  highest  expression  of  the  human  freedom  and  communal  solidarity, 
and  thus  to  be  protected  assiduously  from  state  intrusion. 

There  was  a  particular  hostility  to  anything  that  smacked  of  price- 
fixing.  One  much-repeated  story  held  that  the  Prophet  himself  had 
refused  to  force  merchants  to  lower  prices  during  a  shortage  in  the 
city  of  Medina,  on  the  grounds  that  doing  so  would  be  sacrilegious, 
since,  in  a  free-market  situation,  "prices  depend  on  the  will  of  God."82 
Most  legal  scholars  interpreted  Mohammed's  decision  to  mean  that 
any  government  interference  in  market  mechanisms  should  be  con- 
sidered similarly  sacrilegious,  since  markets  were  designed  by  God  to 
regulate  themselves.83 

If  all  this  bears  a  striking  resemblance  to  Adam  Smith's  "invisible 
hand"  (which  was  also  the  hand  of  Divine  Providence),  it  might  not 
be  a  complete  coincidence.  In  fact,  many  of  the  specific  arguments  and 
examples  that  Smith  uses  appear  to  trace  back  directly  to  economic 
tracts  written  in  Medieval  Persia.  For  instance,  not  only  does  his  argu- 
ment that  exchange  is  a  natural  outgrowth  of  human  rationality  and 
speech  already  appear  both  in  both  Ghazali  (1058-1111  ad),  and  Tusi 
(1201-1274  ad);  both  use  exactly  the  same  illustration:  that  no  one  has 
ever  observed  two  dogs  exchanging  bones.84  Even  more  dramatically, 
Smith's  most  famous  example  of  division  of  labor,  the  pin  factory, 
where  it  takes  eighteen  separate  operations  to  produce  one  pin,  already 
appears  in  Ghazali's  Ihya,  in  which  he  describes  a  needle  factory,  where 
it  takes  twenty-five  different  operations  to  produce  a  needle.85 

The  differences,  however,  are  just  as  significant  as  the  similarities. 
One  telling  example:  like  Smith,  Tusi  begins  his  treatise  on  economics 
with  a  discussion  of  the  division  of  labor;  but  where  for  Smith,  the 
division  of  labor  is  actually  an  outgrowth  of  our  "natural  propensity  to 
truck  and  barter"  in  pursuit  of  individual  advantage,  for  Tusi,  it  was 
an  extension  of  mutual  aid: 

Let  us  suppose  that  each  individual  were  required  to  busy 
himself  with  providing  his  own  sustenance,  clothing,  dwelling- 
place  and  weapons,  first  acquiring  the  tools  of  carpentry  and 
the  smith's  trade,  then  readying  thereby  tools  and  implements 
for  sowing  and  reaping,  grinding  and  kneading,  spinning  and 
weaving  .  .  .  Clearly,  he  would  not  be  capable  of  doing  justice 
to  any  one  of  them.  But  when  men  render  aid  to  each  other, 
each  one  performing  one  of  these  important  tasks  that  are  be- 
yond the  measure  of  his  own  capacity,  and  observing  the  law 
of  justice  in  transactions  by  giving  greatly  and  receiving  in 
exchange  of  the  labor  of  others,  then  the  means  of  livelihood 



are  realized,  and  the  succession  of  the  individual  and  the  sur- 
vival of  the  species  are  assured.86 

As  a  result,  he  argues,  divine  providence  has  arranged  us  to  have 
different  abilities,  desires,  and  inclinations.  The  market  is  simply  one 
manifestation  of  this  more  general  principle  of  mutual  aid,  of  the 
matching  of,  abilities  (supply)  and  needs  (demand) — or  to  translate  it 
into  my  own  earlier  terms,  it  is  not  only  founded  on,  but  is  itself  an 
extension  of  the  kind  of  baseline  communism  on  which  any  society 
must  ultimately  rest. 

All  this  is  not  to  say  that  Tusi  was  in  any  sense  a  radical  egalitar- 
ian. Quite  the  contrary.  "If  men  were  equal,"  he  insists,  "they  would 
all  perish."  We  need  differences  between  rich  and  poor,  he  insisted,  just 
as  much  as  we  need  differences  between  farmers  and  carpenters.  Still, 
once  you  start  from  the  initial  premise  that  markets  are  primarily  about 
cooperation  rather  than  competition — and  while  Muslim  economic 
thinkers  did  recognize  and  accept  the  need  for  market  competition, 
they  never  saw  competition  as  its  essence87 — the  moral  implications  are 
very  different.  Nasruddin's  story  about  the  quail  eggs  might  have  been 
a  joke,  but  Muslim  ethicists  did  often  enjoin  merchants  to  drive  a  hard 
bargain  with  the  rich  so  they  could  charge  less,  or  pay  more,  when 
dealing  with  the  less  fortunate.88 

Ghazali's  take  on  the  division  of  labor  is  similar,  and  his  account 
of  the  origins  of  money  is  if  anything  even  more  revealing.  It  begins 
with  what  looks  much  like  the  myth  of  barter,  except  that,  like  all 
Middle  Eastern  writers,  he  starts  not  with  imaginary  primitive  tribes- 
men, but  with  strangers  meeting  in  an  imaginary  marketplace. 

Sometimes  a  person  needs  what  he  does  not  own  and  he  owns 
what  he  does  not  need.  For  example,  a  person  has  saffron  but 
needs  a  camel  for  transportation  and  one  who  owns  a  camel 
does  not  presently  need  that  camel  but  he  wants  saffron.  Thus, 
there  is  the  need  for  an  exchange.  However,  for  there  to  be  an 
exchange,  there  must  be  a  way  to  measure  the  two  objects,  for 
the  camel-owner  cannot  give  the  whole  camel  for  a  quantity 
of  saffron.  There  is  no  similarity  between  saffron  and  camel 
so  that  equal  amount  of  that  weight  and  form  can  be  given. 
Likewise  is  the  case  of  one  who  desires  a  house  but  owns  some 
cloth  or  desires  a  slave  but  owns  socks,  or  desires  flour  but 
possesses  a  donkey.  These  goods  have  no  direct  proportional- 
ity so  one  cannot  know  how  much  saffron  will  equal  a  camel's 
worth.  Such  barter  transactions  would  be  very  difficult.89 



Ghazali  also  notes  that  there  might  also  be  a  problem  of  one  per- 
son not  even  needing  what  the  other  has  to  offer,  but  this  is  almost 
an  afterthought;  for  him,  the  real  problem  is  conceptual.  How  do  you 
compare  two  things  with  no  common  qualities?  His  conclusion:  it  can 
only  be  done  by  comparing  both  to  a  third  thing  with  no  qualities  at 
all.  For  this  reason,  he  explains,  God  created  dinars  and  dirhams,  coins 
made  out  of  gold  and  silver,  two  metals  that  are  otherwise  no  good 
for  anything: 

Dirhams  and  dinars  are  not  created  for  any  particular  purpose; 
they  are  useless  by  themselves;  they  are  just  like  stones.  They 
are  created  to  circulate  from  hand  to  hand,  to  govern  and  to 
facilitate  transactions.  They  are  symbols  to  know  the  value  and 
grades  of  goods.90 

They  can  be  symbols,  units  of  measure,  because  of  this  very  lack 
of  usefulness,  indeed  lack  of  any  particular  feature  other  than  value: 

A  thing  can  only  be  exactly  linked  to  other  things  if  it  has  no 
particular  special  form  or  feature  of  its  own — for  example,  a 
mirror  that  has  no  color  can  reflect  all  colors.  The  same  is  the 
case  with  money — it  has  no  purpose  of  its  own,  but  it  serves  as 
medium  for  the  purpose  of  exchanging  goods.9' 

From  this  it  also  follows  that  lending  money  at  interest  must  be 
illegitimate,  since  it  means  using  money  as  an  end  in  itself:  "Money 
is  not  created  to  earn  money."  In  fact,  he  says,  "in  relation  to  other 
goods,  dirhams  and  dinars  are  like  prepositions  in  a  sentence,"  words 
that,  as  the  grammarians  inform  us,  are  used  to  give  meaning  to  other 
words,  but  can  only  do  because  they  have  no  meaning  in  themselves. 
Money  is  a  thus  a  unit  of  measure  that  provides  a  means  of  assessing 
the  value  of  goods,  but  also  one  that  operates  as  such  only  if  it  stays  in 
constant  motion.  To  enter  in  monetary  transactions  in  order  to  obtain 
even  more  money,  even  if  it's  a  matter  of  M-C-M',  let  alone  M-M', 
would  be,  according  to  Ghazali,  the  equivalent  of  kidnapping  a  post- 

Whereas  Ghazali  speaks  only  of  gold  and  silver,  what  he  describes — 
money  as  symbol,  as  abstract  measure,  having  no  qualities  of  its  own, 
whose  value  is  only  maintained  by  constant  motion — is  something  that 
would  never  have  occurred  to  anyone  were  it  not  in  an  age  when  it 
was  perfectly  normal  for  money  to  be  employed  in  purely  virtual  form. 



Much  of  our  free-market  doctrine,  then,  appears  to  have  been  originally 
borrowed  piecemeal  from  a  very  different  social  and  moral  universe.93 
The  mercantile  classes  of  the  Medieval  Near  West  had  pulled  off  an  ex- 
traordinary feat.  By  abandoning  the  usurious  practices  that  had  made 
them  so  obnoxious  to  their  neighbors  for  untold  centuries  before,  they 
were  able  to  become — alongside  religious  teachers — the  effective  lead- 
ers of  their  communities:  communities  that  are  still  seen  as  organized, 
to  a  large  extent,  around  the  twin  poles  of  mosque  and  bazaar.94  The 
spread  of  Islam  allowed  the  market  to  become  a  global  phenomenon, 
operating  largely  independent  of  governments,  according  to  its  own 
internal  laws.  But  the  very  fact  that  this  was,  in  a  certain  way,  a  genu- 
ine free  market,  not  one  created  by  the  government  and  backed  by  its 
police  and  prisons — a  world  of  handshake  deals  and  paper  promises 
backed  only  by  the  integrity  of  the  signer — meant  that  it  could  never 
really  become  the  world  imagined  by  those  who  later  adopted  many  of 
the  same  ideas  and  arguments:  one  of  purely  self-interested  individuals 
vying  for  material  advantage  by  any  means  at  hand. 

The  Far  West: 

Christendom  (Commerce,  Lending,  and  War) 

Where  there  is  justice  in  war,  there  is 
also  justice  in  usury. 

— Saint  Ambrose 

Europe,  as  I  mentioned,  came  rather  late  to  the  Middle  Ages  and  for 
most  of  it  was  something  of  a  hinterland.  Still,  the  period  began  much 
as  it  did  elsewhere,  with  the  disappearance  of  coinage.  Money  re- 
treated into  virtuality.  Everyone  continued  to  calculate  costs  in  Roman 
currency,  then,  later,  in  Carolingian  "imaginary  money" — the  purely 
conceptual  system  of  pounds,  shillings,  and  pence  used  across  Western 
Europe  to  keep  accounts  well  into  the  seventeenth  century. 

Local  mints  did  gradually  come  back  into  operation,  producing 
coins  in  an  endless  variety  of  weight,  purity,  and  denominations.  How 
these  related  to  the  pan-European  system,  though,  was  a  matter  of 
manipulation.  Kings  regularly  issued  decrees  revaluing  their  own  coins 
in  relation  to  the  money  of  account,  "crying  up"  the  currency  by,  say, 
declaring  that  henceforth,  one  of  their  ecus  or  escudos  would  no  longer 
be  worth  V12  but  now  '/s  of  a  shilling  (thus  effectively  raising  taxes) 
or  "crying  down"  the  value  of  their  coins  by  doing  the  reverse  (thus 



effectively  reducing  their  debts).95  The  real  gold  or  silver  content  of 
coins  was  endlessly  readjusted,  and  currencies  were  frequently  called  in 
for  re-minting.  Meanwhile,  most  everyday  transactions  dispensed  with 
cash  entirely,  operating  through  tallies,  tokens,  ledgers,  or  transactions 
in  kind.  As  a  result,  when  the  Scholastics  came  to  address  such  matters 
in  the  thirteenth  century,  they  quickly  adopted  Aristotle's  position  that 
money  was  a  mere  social  convention:  that  it  was,  basically,  whatever 
human  beings  decided  that  it  was.96 

All  this  fit  the  broader  Medieval  pattern:  actual  gold  and  silver, 
such  of  it  as  was  still  around,  was  increasingly  laid  up  in  sacred  places; 
as  centralized  states  disappeared,  the  regulation  of  markets  was  in- 
creasingly in  the  hands  of  the  Church. 

At  first,  the  Catholic  attitudes  toward  usury  were  just  as  harsh  as 
Muslim  ones,  and  attitudes  toward  merchants,  considerably  harsher.  In 
the  first  case,  they  had  little  choice,  as  many  Biblical  texts  were  quite 
explicit.  Consider  Exodus  22:25: 

If  you  lend  money  to  My  people,  to  the  poor  among  you,  you 
are  not  to  act  as  a  creditor  to  him;  you  shall  not  charge  him 

Both  the  Psalms  (15:5,  54:12)  and  Prophets  (Jeremiah  9.6,  Nehemiah 
5:11)  were  explicit  in  assigning  usurers  to  death  and  hellfire.  What's  more, 
the  early  Christian  Fathers,  who  laid  the  foundation  of  Church  teachings 
on  social  issues  in  the  waning  years  of  the  Roman  empire,  were  writing 
amidst  the  ancient  world's  last  great  debt  crisis,  one  that  was  effec- 
tively in  the  process  of  destroying  the  empire's  remaining  free  peasant- 
ry.97 While  few  were  willing  to  condemn  slavery,  all  condemned  usury. 

Usury  was  seen  above  all  as  an  assault  on  Christian  charity,  on 
Jesus's  injunction  to  treat  the  poor  as  they  would  treat  the  Christ  him- 
self, giving  without  expectation  of  return  and  allowing  the  borrower 
to  decide  on  recompense  (Luke  6:34-35).  'n  3^5  ad>  for  instance,  St. 
Basil  delivered  a  sermon  on  usury  in  Cappadocia  that  set  the  standard 
for  such  issues: 

The  Lord  gave  His  own  injunction  quite  plainly  in  the  words, 
"from  him  that  would  borrow  of  thee  turn  not  thou  away."98 
But  what  of  the  money  lover?  He  sees  before  him  a  man 
under  stress  of  necessity  bent  to  the  ground  in  supplication. 
He  sees  him  hesitating  at  no  act,  no  words,  of  humiliation.  He 
sees  him  suffering  undeserved  misfortune,  but  he  is  merciless. 
He  does  not  reckon  that  he  is  a  fellow-creature.  He  does  not 



give  in  to  his  entreaties.  He  stands  stiff  and  sour.  He  is  moved 
by  no  prayers;  his  resolution  is  broken  by  no  tears.  He  persists 
in  refusal  .  . 

That  is,  until  the  suppliant  mentions  "interest." 

Basil  was  particularly  offended  by  the  crass  dishonesty  by  which 
moneylenders  operated;  their  abuse  of  Christian  fellowship.  The  man 
in  need  comes  seeking  a  friend,  the  rich  man  pretends  to  be  one.  In  fact 
he's  a  secret  enemy,  and  everything  he  says  is  a  lie.  Witness,  St.  Basil 
said,  how  the  rich  man  will  always  at  first  swear  mighty  oaths  that  he 
has  no  money  to  his  name: 

Then  the  suppliant  mentions  interest,  and  utters  the  word  secu- 
rity. All  is  changed.  The  frown  is  relaxed;  with  a  genial  smile 
he  recalls  old  family  connection.  Now  it  is  "my  friend." 

"I  will  see,"  says  he,  "if  I  have  any  money  by  me.  Yes, 
there  is  that  sum  which  a  man  I  know  has  left  in  my  hands  on 
deposit  for  profit.  He  stipulated  a  very  heavy  rate  of  interest. 
However,  I  shall  certainly  take  something  off,  and  give  it  to 
you  on  better  terms."  With  pretences  of  this  kind  and  talk  like 
this  he  fawns  on  the  wretched  victim,  and  induces  him  to  swal- 
low the  bait.  Then  he  binds  him  with  a  written  security,  adds 
loss  of  liberty  to  the  trouble  of  his  pressing  poverty,  and  is  off. 
The  man  who  has  made  himself  responsible  for  interest  that  he 
cannot  pay  has  accepted  voluntary  slavery  for  life.100 

The  borrower,  coming  home  with  his  newfound  money,  at  first 
rejoices.  But  quickly,  "the  money  slips  away,"  interest  accumulates, 
and  his  possessions  are  sold  off.  Basil  grows  poetic  in  describing  the 
debtor's  plight.  It's  as  if  time  itself  has  become  his  enemy.  Every  day 
and  night  conspires  against  him,  as  they  are  the  parents  of  interest.  His 
life  becomes  a  "sleepless  daze  of  anxious  uncertainty,"  as  he  is  humili- 
ated in  public;  while  at  home,  he  is  constantly  hiding  under  the  couch 
at  every  unexpected  knock  on  the  door,  and  can  barely  sleep,  startled 
awake  by  nightmare  visions  of  his  creditor  standing  over  his  pillow.101 

Probably  the  most  famous  ancient  homily  on  usury,  though,  was 
Saint  Ambrose's  De  Tobia,  pronounced  over  several  days  in  Milan  in 
380  BC.  He  reproduces  the  same  vivid  details  as  Basil:  fathers  forced 
to  sell  their  children,  debtors  who  hanged  themselves  out  of  shame. 
Usury,  he  observes,  must  be  considered  a  form  of  violent  robbery,  even 
murder.102  Ambrose,  though,  added  one  small  proviso  that  was  later  to 
have  enormous  influence.  His  sermon  was  the  first  to  carefully  examine 



every  Biblical  reference  to  moneylending,  which  meant  that  he  had  to 
address  the  one  problem  later  authors  always  had  to  struggle  with — the 
fact  that,  in  the  Old  Testament,  usury  is  not  quite  forbidden  to  every- 
one. The  key  sticking  point  is  always  Deuteronomy  23:19-20: 

Thou  shalt  not  lend  upon  usury  to  thy  brother;  usury  of  mon- 
ey, usury  of  victuals,  usury  of  any  thing  that  is  lent  upon  usury. 

Unto  a  stranger  thou  mayest  lend  upon  usury;  but  unto  thy 
brother  thou  shalt  not  lend  upon  usury. 

So  who  then  is  this  "stranger"  or  (a  better  translation  of  the  He- 
brew nokri,  "foreigner")?  Presumably,  one  against  whom  robbery  and 
murder  would  have  been  justified  as  well.  After  all,  the  ancient  Jews 
lived  amidst  tribes  like  the  Amalekites,  on  whom  God  had  specifically 
instructed  them  to  make  war.  If  by  extracting  interest  one  is,  as  he  puts 
it,  fighting  without  a  sword,  then  it  is  only  legitimate  to  do  so  from 
those  "whom  it  would  not  be  a  crime  to  kill."103  For  Ambrose,  living  in 
Milan,  all  this  was  something  of  a  technicality.  He  included  all  Chris- 
tians and  all  those  subject  to  Roman  law  as  "brothers";  there  weren't, 
then,  lot  of  Amalekites  around.104  Later,  the  "Exception  of  St.  Am- 
brose," as  it  came  to  be  known,  was  to  become  extremely  important. 

All  of  these  sermons — and  there  were  many  of  them — left  certain 
critical  questions  unanswered.  What  should  the  rich  man  do  when 
receiving  a  visit  from  his  troubled  neighbor?  True,  Jesus  had  said  to 
give  without  expectation  of  return,  but  it  seemed  unrealistic  to  expect 
most  Christians  to  do  that.  And  even  if  they  did,  what  sort  of  ongoing 
relationships  would  that  create?  St.  Basil  took  the  radical  position.  God 
had  given  us  all  things  in  common,  and  he  had  specifically  instructed 
the  rich  to  give  their  possessions  to  the  poor.  The  communism  of 
the  Apostles — who  pooled  all  their  wealth,  and  took  freely  what  they 
needed — was  thus  the  only  proper  model  for  a  truly  Christian  soci- 
ety.105 Few  of  the  other  Christian  Fathers  were  willing  to  take  things 
this  far.  Communism  was  the  ideal,  but  in  this  fallen  and  temporary 
world,  they  argued,  it  was  simply  unrealistic.  The  Church  must  accept 
existing  property  arrangements,  but  also  come  up  with  spiritual  argu- 
ments to  encourage  the  rich  to  nonetheless  act  with  Christian  charity. 
Many  of  these  employed  distinctly  commercial  metaphors.  Even  Basil 
was  willing  to  indulge  in  this  sort  of  thing: 

Whenever  you  provide  for  the  destitute  on  account  of  the  Lord, 
it  is  both  a  gift  and  a  loan.  It  is  a  gift  because  you  entertain  no 



hope  in  recovering  it,  a  loan  because  of  our  Lord's  munificence 
in  paying  you  back  on  his  behalf,  when,  having  taken  a  small 
sum  for  the  poor,  he  will  give  you  back  a  vast  sum  in  return. 
"For  he  who  takes  pity  on  the  poor,  lends  to  God."106 

Since  Christ  is  in  the  poor,  a  gift  of  charity  is  a  loan  to  Jesus,  to  be 
repaid  with  interest  inconceivable  on  earth. 

Charity,  however,  is  a  way  of  maintaining  hierarchy,  not  under- 
mining it.  What  Basil  is  talking  about  here  really  has  nothing  to  do 
with  debt,  and  playing  with  such  metaphors  seems  ultimately  to  serve 
only  to  underline  the  fact  that  the  rich  man  doesn't  owe  the  poor  sup- 
pliant anything,  any  more  than  God  is  in  any  way  legally  bound  to 
save  the  soul  of  anyone  who  feeds  a  beggar.  "Debt"  here  dissolves  into 
a  pure  hierarchy  (hence,  "the  Lord")  where  utterly  different  beings 
provide  each  other  utterly  different  kinds  of  benefit.  Later  theologians 
were  to  explicitly  confirm  this:  human  beings  live  in  time,  noted  St. 
Thomas  Aquinas,  so  it  makes  sense  to  say  that  sin  is  a  debt  of  punish- 
ment we  owe  to  God.  But  God  lives  outside  of  time.  By  definition,  he 
cannot  owe  anything  to  anyone.  His  grace  can  therefore  only  be  a  gift 
given  with  no  obligation.107 

This,  in  turn,  provides  an  answer  to  the  question:  What  are  they 
really  asking  the  rich  man  to  do?  The  Church  opposed  usury,  but  it  had 
little  to  say  about  relations  of  feudal  dependency,  where  the  rich  man 
provides  charity  and  the  poor  suppliant  shows  his  gratitude  in  other 
ways.  Neither,  when  these  kinds  of  arrangements  began  to  emerge 
across  the  Christian  West,  did  the  Church  offer  significant  objections.108 
Former  debt  peons  were  gradually  transformed  into  serfs  or  vassals. 
In  some  ways,  the  relationship  was  not  much  different,  since  vassalage 
was,  in  theory,  a  voluntary,  contractual  relationship.  Just  as  a  Chris- 
tian has  to  be  able  to  freely  choose  to  submit  himself  to  "the  Lord,"  so 
did  a  vassal  have  to  agree  to  make  himself  someone  else's  man.  All  this 
proved  perfectly  consonant  with  Christianity. 

Commerce,  on  the  other  hand,  remained  a  problem.  There  was 
not  much  of  a  leap  between  condemning  usury  as  the  taking  of  "what- 
ever exceeds  the  amount  loaned"  and  condemning  any  form  of  profit- 
taking.  Many — Saint  Ambrose  among  them — were  willing  to  take  that 
leap.  Where  Mohammed  declared  that  an  honest  merchant  deserved 
a  place  by  the  seat  of  God  in  heaven,  men  like  Ambrose  wondered  if 
an  "honest  merchant"  could  actually  exist.  Many  held  that  one  simply 
could  not  be  both  a  merchant  and  a  Christian.109  In  the  early  Middle 
Ages,  this  was  not  a  pressing  issue — especially  since  so  much  commerce 
was  conducted  by  foreigners.  The  conceptual  problems,  however,  were 



never  resolved.  What  did  it  mean  that  one  could  only  lend  to  "strang- 
ers"? Was  it  just  usury,  or  was  even  commerce  tantamount  to  war? 

Probably  the  most  notorious,  and  often  catastrophic,  way  that  this 
problem  worked  itself  out  in  the  High  Middle  Ages  was  in  relations 
between  Christians  and  Jews.  In  the  years  since  Nehemiah,  Jewish 
attitudes  toward  lending  had  themselves  changed.  In  the  time  of  Au- 
gustus, Rabbi  Hillel  had  effectively  rendered  the  sabbatical  year  a  dead 
letter,  by  allowing  two  parties  to  place  a  rider  on  any  particular  loan 
contract  agreeing  that  it  would  not  apply.  While  both  the  Torah  and 
the  Talmud  stand  opposed  to  loans  on  interest,  exceptions  were  made 
in  dealing  with  Gentiles — particularly  as,  over  the  course  of  the  elev- 
enth and  twelfth  centuries,  European  Jews  were  excluded  from  almost 
any  other  line  of  work."0  This  in  turn  made  it  harder  to  contain  the 
practice,  as  witnessed  in  the  common  joke,  current  in  twelfth-century 
ghettos  to  justify  usury  between  Jews.  It  consisted,  it  is  said,  of  reciting 
Deuteronomy  23:20  in  interrogative  tones  to  make  it  mean  the  opposite 
of  its  obvious  sense:  'Unto  a  foreigner  thou  mayest  lend  upon  usury, 
but  unto  thy  brother  thou  shalt  not  lend  upon  usury?"11 

On  the  Christian  side,  in  1140  ad  the  "Exception  of  Saint  Ambrose" 
found  its  way  into  Gratian's  Decretum,  which  came  to  be  considered 
the  definitive  collection  of  canon  law.  At  the  time,  economic  life  fell 
very  much  under  the  jurisdiction  of  the  Church.  While  that  might  ap- 
pear to  leave  Jews  safely  outside  the  system,  in  reality,  matters  were 
more  complicated.  For  one  thing,  while  both  Jews  and  Gentiles  would 
occasionally  attempt  to  make  recourse  to  the  Exception,  the  prevail- 
ing opinion  was  that  it  only  really  applied  to  Saracens  or  others  with 
whom  Christendom  was  literally  at  war.  After  all,  Jews  and  Christians 
lived  in  the  same  towns  and  villages.  If  one  were  to  concede  that  the 
Exception  allowed  Jews  and  Christians  the  right  to  lend  to  each  other 
at  interest,  it  would  also  mean  that  they  had  the  right  to  murder  one 
another."2  No  one  really  wanted  to  say  that.  On  the  other  hand,  real 
relations  between  Christians  and  Jews  often  did  seem  to  skate  perilous- 
ly close  to  this  unfortunate  ideal — though  obviously  the  actual  murder 
(apart  from  mere  economic  aggression)  was  all  on  one  side. 

In  part  this  was  due  to  the  habit  of  Christian  princes  of  exploit- 
ing, for  their  own  purposes,  the  fact  that  Jews  did  sit  slightly  outside 
the  system.  Many  encouraged  Jews  to  operate  as  moneylenders,  under 
their  protection,  simply  because  they  also  knew  that  protection  could 
be  withdrawn  at  any  time.  The  kings  of  England  were  notorious  in 



this  regard.  They  insisted  that  Jews  be  excluded  from  merchant  and 
craft  guilds,  but  granted  them  the  right  to  charge  extravagant  rates  of 
interest,  backing  up  the  loans  by  the  full  force  of  law.113  Debtors  in 
Medieval  England  were  regularly  thrown  in  prisons  until  their  families 
settled  with  the  creditor.114  Yet  the  same  regularly  happened  to  the 
Jews  themselves.  In  1210  ad,  for  example,  King  John  ordered  a  tallage, 
or  emergency  levy,  to  pay  for  his  wars  in  France  and  Ireland.  Accord- 
ing to  one  contemporary  chronicler  "all  the  Jews  throughout  England, 
of  both  sexes,  were  seized,  imprisoned,  and  tortured  severely,  in  order 
to  do  the  king's  will  with  their  money."  Most  who  where  put  to  torture 
offered  all  they  had  and  more — but  on  that  occasion,  one  particularly 
wealthy  merchant,  a  certain  Abraham  of  Bristol,  who  the  king  decided 
owed  him  ten  thousand  marks  of  silver  (a  sum  equivalent  to  about  a 
sixth  of  John's  total  annual  revenue),  became  famous  for  holding  out. 
The  king  therefore  ordered  that  one  of  his  molars  be  pulled  out  daily, 
until  he  paid.  After  seven  had  been  extracted,  Abraham  finally  gave 

John's  successor,  Henry  III  (1216-1272  ad),  was  in  the  habit  of  turn- 
ing over  Jewish  victims  to  his  brother  the  Earl  of  Cornwall,  so  that, 
as  another  chronicler  put  it,  "those  whom  one  brother  had  flayed,  the 
other  might  embowel."116  Such  stories  about  the  extraction  of  Jewish 
teeth,  skin,  and  intestines  are,  I  think,  important  to  bear  in  mind  when 
thinking  about  Shakespeare's  imaginary  Merchant  of  Venice  demand- 
ing his  "pound  of  flesh."117  It  all  seems  to  have  been  a  bit  of  a  guilty 
projection  of  terrors  that  Jews  had  never  really  visited  on  Christians, 
but  that  had  been  directed  the  other  way  around. 

The  terror  inflicted  by  kings  carried  in  it  a  peculiar  element  of 
identification:  the  persecutions  and  appropriations  were  an  extension 
of  the  logic  whereby  kings  effectively  treated  debts  owed  to  Jews  as  ul- 
timately owed  to  themselves,  even  setting  up  a  branch  of  the  Treasury 
("the  Exchequer  of  the  Jews")  to  manage  them.118  This  was  of  course 
much  in  keeping  with  the  popular  English  impression  of  their  kings 
as  themselves  a  group  of  rapacious  Norman  foreigners.  But  it  also 
gave  the  kings  the  opportunity  to  periodically  play  the  populist  card, 
dramatically  snubbing  or  humiliating  their  Jewish  financiers,  turning 
a  blind  eye  or  even  encouraging  pogroms  by  townsfolk  who  chose  to 
take  the  Exception  of  Saint  Ambrose  literally,  and  treat  moneylenders 
as  enemies  of  Christ  who  could  be  murdered  in  cold  blood.  Particularly 
gruesome  massacres  occurred  in  Norwich  in  1144  ad,  and  in  France, 
in  Blois  in  1171.  Before  long,  as  Norman  Cohn  put  it,  "what  had  once 
been  a  flourishing  Jewish  culture  had  turned  into  a  terrorized  society 
locked  in  perpetual  warfare  with  the  greater  society  around  it."119 



One  mustn't  exaggerate  the  Jewish  role  in  lending.  Most  Jews  had 
nothing  to  do  with  the  business,  and  those  who  did  were  typically  bit 
players,  making  minor  loans  of  grain  or  cloth  for  a  return  in  kind. 
Others  weren't  even  really  Jews.  Already  in  the  1190s,  preachers  were 
complaining  about  lords  who  would  work  hand  in  glove  with  Christian 
moneylenders  claiming  they  were  "our  Jews" — and  thus  under  their 
special  protection.120  By  the  1100s,  most  Jewish  moneylenders  had  long 
since  been  displaced  by  Lombards  (from  Northern  Italy)  and  Cahorsins 
(from  the  French  town  of  Cahors) — who  established  themselves  across 
Western  Europe,  and  became  notorious  rural  usurers.121 

The  rise  of  rural  usury  was  itself  a  sign  of  a  growing  free  peasantry 
(there  had  been  no  point  in  making  loans  to  serfs,  since  they  had  noth- 
ing to  repossess).  It  accompanied  the  rise  of  commercial  farming,  urban 
craft  guilds,  and  the  "commercial  revolution"  of  the  High  Middle  Ages, 
all  of  which  finally  brought  Western  Europe  to  a  level  of  economic 
activity  comparable  to  that  long  since  considered  normal  in  other  parts 
of  the  world.  The  Church  quickly  came  under  considerable  popular 
pressure  to  do  something  about  the  problem,  and  at  first,  it  did  try  to 
tighten  the  clamps.  Existing  loopholes  in  the  usury  laws  were  system- 
atically closed,  particularly  the  use  of  mortgages.  These  latter  began  as 
an  expedient:  as  in  Medieval  Islam,  those  determined  to  dodge  the  law 
could  simply  present  the  money,  claim  to  be  buying  the  debtor's  house 
or  field,  and  then  "rent"  it  back  to  the  debtor  until  the  principal  was 
repaid.  In  the  case  of  a  mortgage,  the  house  was  in  theory  not  even 
purchased  but  pledged  as  security,  but  any  income  from  it  accrued  to 
the  lender.  In  the  eleventh  century  this  became  a  favorite  trick  of  mon- 
asteries. In  1148  it  was  made  illegal:  henceforth,  all  income  was  to  be 
subtracted  from  the  principal.  Similarly,  in  1187  merchants  were  forbid- 
den to  charge  higher  prices  when  selling  on  credit — the  Church  thereby 
going  much  further  than  any  school  of  Islamic  law  ever  had.  In  1179 
usury  was  made  a  mortal  sin  and  usurers  were  excommunicated  and 
denied  Christian  burial.122  Before  long,  new  orders  of  itinerant  friars 
like  the  Franciscans  and  Dominicans  organized  preaching  campaigns, 
traveling  town  to  town,  village  to  village,  threatening  moneylenders 
with  the  loss  of  their  eternal  souls  if  they  did  not  make  restitution  to 
their  victims. 

All  this  was  echoed  by  a  heady  intellectual  debate  in  the  newly 
founded  universities,  not  so  much  as  to  whether  usury  was  sinful  and 
illegal,  but  precisely  why.  Some  argued  that  it  was  theft  of  another's 
material  possessions;  others  that  it  constituted  a  theft  of  time,  charg- 
ing others  for  something  that  belonged  only  to  God.  Some  held  that  it 
embodied  the  sin  of  Sloth,  since  like  the  Confucians,  Catholic  thinkers 



usually  held  that  a  merchant's  profit  could  only  be  justified  as  payment 
for  his  labor  (i.e.,  in  transporting  goods  to  wherever  they  were  needed), 
whereas  interest  accrued  even  if  the  lender  did  nothing  at  all.  Soon  the 
rediscovery  of  Aristotle,  who  returned  in  Arabic  translation  (and  the 
influence  of  Muslim  sources  like  Ghazali  and  Ibn  Sina),  added  new  ar- 
guments: that  treating  money  as  an  end  in  itself  defied  its  true  purpose; 
that  charging  interest  was  unnatural,  in  that  it  treated  mere  metal  as  if 
it  were  a  living  thing  that  could  breed  or  bear  fruit.123 

But  as  the  Church  authorities  soon  discovered,  when  one  starts 
something  like  this,  it's  very  hard  to  keep  a  lid  on  it.  Soon,  new  popu- 
lar religious  movements  were  appearing  everywhere,  and  many  took  up 
the  same  direction  so  many  had  in  late  Antiquity,  not  only  challeng- 
ing commerce  but  questioning  the  very  legitimacy  of  private  property. 
Most  were  labeled  heresies  and  violently  suppressed,  but  many  of  the 
same  arguments  were  taken  up  amongst  the  mendicant  orders  them- 
selves. By  the  thirteenth  century,  the  great  intellectual  debate  was  be- 
tween the  Franciscans  and  the  Dominicans  over  "apostolic  poverty" — 
basically,  over  whether  Christianity  could  be  reconciled  with  property 
of  any  sort. 

At  the  same  time,  the  revival  of  Roman  law — which,  as  we've  seen, 
began  from  the  assumption  of  absolute  private  property — put  new  in- 
tellectual weapons  in  the  hands  of  those  who  wished  to  argue  that,  at 
least  in  the  case  of  commercial  loans,  usury  laws  should  be  relaxed. 
The  great  discovery  in  this  case  was  the  notion  of  interesse,  which  is 
where  our  word  "interest"  originally  comes  from:  a  compensation  for 
loss  suffered  because  of  late  payment.124  The  argument  soon  became 
that  if  a  merchant  made  a  commercial  loan  even  for  some  minimal  pe- 
riod (say,  a  month),  it  was  not  usurious  for  him  to  charge  a  percentage 
for  each  month  afterward,  since  this  was  a  penalty,  not  rental  for  the 
money,  and  it  was  justified  as  compensation  for  the  profit  he  would 
have  made,  had  he  placed  it  in  some  profitable  investment,  as  any  mer- 
chant would  ordinarily  be  expected  to  do.125 

The  reader  may  be  wondering  how  it  could  have  been  possible  for 
usury  laws  to  move  in  two  opposite  directions  simultaneously.  The 
answer  would  seem  to  be  that  politically,  the  situation  in  Western 
Europe  was  remarkably  chaotic.  Most  kings  were  weak,  their  holdings 
fractured  and  uncertain;  the  Continent  was  a  checkerboard  of  baronies, 
principalities,  urban  communes,  manors,  and  church  estates.  Jurisdic- 
tions were  constantly  being  renegotiated — usually  by  war.  Merchant 



capitalism  of  the  sort  long  familiar  in  the  Muslim  Near  West  only  real- 
ly managed  to  establish  itself — quite  late,  compared  with  the  situation 
in  the  rest  of  the  Medieval  world — when  merchant  capitalists  managed 
to  secure  a  political  foothold  in  the  independent  city-states  of  northern 
Italy — most  famously,  Venice,  Florence,  Genoa,  and  Milan — followed 
by  the  German  cities  of  the  Hanseatic  League.126  Italian  bankers  ulti- 
mately managed  to  free  themselves  from  the  threat  of  expropriation  by 
themselves  taking  over  governments,  and  by  doing  so,  acquiring  their 
own  court  systems  (capable  of  enforcing  contracts)  and  even  more  criti- 
cally, their  own  armies.127 

What  jumps  out,  in  comparison  with  the  Muslim  world,  are  these 
links  of  finance,  trade,  and  violence.  Whereas  Persian  and  Arab  think- 
ers assumed  that  the  market  emerged  as  an  extension  of  mutual  aid, 
Christians  never  completely  overcame  the  suspicion  that  commerce  was 
really  an  extension  of  usury,  a  form  of  fraud  only  truly  legitimate  when 
directed  against  one's  mortal  enemies.  Debt  was,  indeed,  sin — on  the 
part  of  both  parties  to  the  transaction.  Competition  was  essential  to  the 
nature  of  the  market,  but  competition  was  (usually)  nonviolent  war- 
fare. There  was  a  reason  why,  as  I've  already  observed,  the  words  for 
"truck  and  barter"  in  almost  all  European  languages  were  derived  from 
terms  meaning  "swindle,"  "bamboozle,"  or  "deceive."  Some  disdained 
commerce  for  that  reason.  Others  embraced  it.  Few  would  have  denied 
that  the  connection  was  there. 

One  need  only  examine  the  way  that  Islamic  credit  instruments — 
or  for  that  matter,  the  Islamic  ideal  of  the  merchant  adventurer — were 
eventually  adopted  to  see  just  how  intimate  this  connection  really  was. 

It  is  often  held  that  the  first  pioneers  of  modern  banking  were  the 
Military  Order  of  the  Knights  of  the  Temple  of  Solomon,  commonly 
known  as  the  Knights  Templar.  A  fighting  order  of  monks,  they  played 
a  key  role  in  financing  the  Crusades.  Through  the  Templars,  a  lord  in 
southern  France  might  take  out  a  mortgage  on  one  of  his  tenements 
and  receive  a  "draft"  (a  bill  of  exchange,  modeled  on  the  Muslim  suf- 
taja,  but  written  in  a  secret  code)  redeemable  for  cash  from  the  Temple 
in  Jerusalem.  In  other  words,  Christians  appear  to  have  first  adopted 
Islamic  financial  techniques  to  finance  attacks  against  Islam. 

The  Templars  lasted  from  1118  to  1307,  but  they  finally  went  the 
way  of  so  many  Medieval  trading  minorities:  King  Phillip  IV,  deep 
in  debt  to  the  order,  turned  on  them,  accusing  them  of  unspeakable 
crimes;  their  leaders  were  tortured  and  ultimately  killed,  and  their 
wealth  was  expropriated.128  Much  of  the  problem  was  that  they  lacked 
a  powerful  home  base.  Italian  banking  houses  such  as  the  Bardi,  Pe- 
ruzzi,  and  Medici  did  much  better.  In  banking  history,  the  Italians  are 



most  famous  for  their  complex  joint-stock  organization  and  for  spear- 
heading the  use  of  Islamic-style  bills  of  exchange.129  At  first  these  were 
simple  enough:  basically  just  a  form  of  long-distance  money-changing. 
A  merchant  could  present  a  certain  amount  in  florins  to  a  banker  in 
Italy  and  receive  a  notarized  bill  registering  the  equivalent  in  the  in- 
ternational money  of  account  (Carolingian  derniers),  due  in,  say,  three 
months'  time,  and  then  after  it  came  due,  either  he  or  his  agent  could 
cash  it  for  an  equivalent  amount  of  local  currency  in  the  Champagne 
fairs,  which  were  both  the  great  yearly  commercial  emporia,  and  great 
financial  clearing  houses,  of  the  European  High  Middle  Ages.  But  they 
quickly  morphed  into  a  plethora  of  new,  creative  forms,  mainly  a  way 
of  navigating — or  even  profiting  from — the  endlessly  complicated  Eu- 
ropean currency  situation.130 

Most  of  the  capital  for  these  banking  enterprises  derived  from  the 
Mediterranean  trade  in  Indian  Ocean  spices  and  Eastern  luxuries.  Yet 
unlike  the  Indian  Ocean,  the  Mediterranean  was  a  constant  war  zone. 
Venetian  galleys  doubled  as  both  merchant  vessels  and  warships,  re- 
plete with  cannon  and  marines,  and  the  differences  between  trade,  cru- 
sade, and  piracy  often  depended  on  the  balance  of  forces  at  any  given 
moment.13'  The  same  was  true  on  land:  where  Asian  empires  tended 
to  separate  the  sphere  of  warriors  and  merchants,  in  Europe  they  often 

All  up  and  down  Central  Europe,  from  Tuscany  to  Flan- 
ders, from  Brabant  to  Livonia,  merchants  not  only  supplied 
warriors — as  they  did  all  over  Europe — they  sat  in  govern- 
ments that  made  war  and,  sometimes,  buckled  on  armor  and 
went  into  battle  themselves.  Such  places  make  a  long  list:  not 
only  Florence,  Milan,  Venice,  and  Genoa,  but  also  Augsburg, 
Nuremberg,  Strasbourg,  and  Zurich;  not  only  Liibeck,  Ham- 
burg, Bremen,  and  Danzig,  but  also  Bruges,  Ghent,  Leiden,  and 
Cologne.  Some  of  them — Florence,  Nuremberg,  Siena,  Bern, 
and  Ulm  come  to  mind — built  considerable  territorial  states.132 

The  Venetians  were  only  the  most  famous  in  this  regard.  They 
created  a  veritable  mercantile  empire  over  the  course  of  the  eleventh 
century,  seizing  islands  like  Crete  and  Cyprus  and  establishing  sugar 
plantations  that  eventually — anticipating  a  pattern  eventually  to  be- 
come all  too  familiar  in  the  New  World — came  to  be  staffed  largely 
by  African  slaves.133  Genoa  soon  followed  suit;  one  of  their  most  lucra- 
tive businesses  was  raiding  and  trading  along  the  Black  Sea  to  acquire 
slaves  to  sell  to  the  Mamluks  in  Egypt  or  to  work  mines  leased  from 



the  Turks.134  The  Genoese  republic  was  also  the  inventor  of  a  unique 
mode  of  military  financing,  which  might  be  known  as  war  by  subscrip- 
tion, whereby  those  planning  expeditions  sold  shares  to  investors  in 
exchange  for  the  rights  to  an  equivalent  percentage  of  the  spoils.  It 
was  precisely  the  same  galleys,  with  the  same  "merchant  adventurers" 
aboard,  who  would  eventually  pass  through  the  pillars  of  Hercules  to 
follow  the  Atlantic  coast  to  Flanders  or  the  Champagne  fairs,  carrying 
cargoes  of  nutmeg  or  cayenne,  silks  and  woolen  goods — along  with  the 
inevitable  bills  of  exchange.135 

It  would  be  instructive,  I  think,  to  pause  a  moment  to  think  about 
this  term,  "merchant  adventurer."  Originally  it  just  meant  a  merchant 
who  operated  outside  his  own  country.  It  was  around  this  same  time, 
however,  at  the  height  of  the  fairs  of  Champagne  and  the  Italian  mer- 
chant empires,  between  1160  and  1172.,  that  the  term  "adventure"  be- 
gan to  take  on  its  contemporary  meaning.  The  man  most  responsible 
for  it  was  the  French  poet  Chretien  de  Troyes,  author  of  the  famous 
Arthurian  romances — most  famous,  perhaps,  for  being  the  first  to  tell 
the  story  of  Sir  Percival  and  the  Holy  Grail.  The  romances  were  a  new 
sort  of  literature  featuring  a  new  sort  of  hero,  the  "knight-errant,"  a 
warrior  who  roamed  the  world  in  search  of,  precisely,  "adventure" — in 
the  contemporary  sense  of  the  word:  perilous  challenges,  love,  trea- 
sure, and  renown.  Stories  of  knightly  adventure  quickly  became  enor- 
mously popular,  Chretein  was  followed  by  innumerable  imitators,  and 
the  central  characters  in  the  stories — Arthur  and  Guinevere,  Lance- 
lot, Gawain,  Percival,  and  the  rest — became  known  to  everyone,  as 
they  are  still.  This  courtly  ideal  of  the  gallant  knight,  the  quest,  the 
joust,  romance  and  adventure,  remains  central  to  our  image  of  the 
Middle  Ages.136 

The  curious  thing  is  that  it  bears  almost  no  relation  to  reality. 
Nothing  remotely  like  a  real  "knight-errant"  ever  existed.  "Knights" 
had  originally  been  a  term  for  freelance  warriors,  drawn  from  the 
younger  or,  often,  bastard  sons  of  the  minor  nobility.  Unable  to  in- 
herit, many  were  forced  to  band  together  to  seek  their  fortunes.  Many 
became  little  more  than  roving  bands  of  thugs,  in  an  endless  pursuit 
of  plunder — precisely  the  sort  of  people  who  made  merchants'  lives  so 
dangerous.  Culminating  in  the  twelfth  century,  there  was  a  concerted 
effort  to  bring  this  dangerous  population  under  the  control  of  the  civil 
authorities:  not  only  the  code  of  chivalry,  but  the  tournament,  the 
joust — all  these  were  more  than  anything  else  ways  of  keeping  them 



out  of  trouble,  as  it  were,  in  part  by  setting  knights  against  each  other, 
in  part  by  turning  their  entire  existence  into  a  kind  of  stylized  ritual.137 
The  ideal  of  the  lone  wandering  knight,  in  search  of  some  gallant  ad- 
venture, on  the  other  hand,  seems  to  have  come  out  of  nowhere. 

This  is  important,  since  it  lies  at  the  very  heart  of  our  image  of  the 
Middle  Ages — and  the  explanation,  I  think,  is  revealing.  We  have  to 
recall  that  merchants  had  begun  to  achieve  unprecedented  social  and 
even  political  power  around  this  time,  but  that,  in  dramatic  contrast  to 
Islam,  where  a  figure  like  Sindbad — the  successful  merchant  adventurer — 
could  serve  as  a  fictional  exemplar  of  the  perfect  life,  merchants,  unlike 
warriors,  were  never  seen  as  paragons  of  much  of  anything. 

It's  likely  no  coincidence  that  Chretien  was  living  in  Troyes,  at  the 
very  heartland  of  the  Champagne  fairs  that  had  become,  in  turn,  the 
commercial  hub  of  Western  Europe.138  While  he  appears  to  have  mod- 
eled his  vision  of  Camelot  on  the  elaborate  court  life  under  his  patron 
Henri  the  Liberal  (1152-1181),  Count  of  Champagne,  and  his  wife  Ma- 
rie, daughter  of  Eleanor  of  Aquitaine,  the  real  court  was  staffed  by  low- 
born commergants,  who  served  as  Serjeants  of  the  fairs — leaving  most 
real  knights  in  the  role  of  onlookers,  guards,  or — at  tournaments — 

This  is  not  to  say  that  tournaments  did  not  become  a  kind  of 
economic  focus  in  their  own  right,  according  to  one  early  twentieth- 
century  Medievalist,  Amy  Kelly: 

The  biographer  of  Guillaume  le  Marechal  gives  an  idea  of  how 
this  rabble  of  courtly  routiers  amused  itself  on  the  jousting 
fields  of  western  Europe.  To  the  tournaments,  occurring  in  a 
brisk  season  about  twice  a  month  from  Pentecost  to  the  feast  of 
St  John,  flocked  the  young  bloods,  sometimes  three  thousand 
strong,  taking  possession  of  the  nearest  town.  Thither  also 
flocked  horse  dealers  from  Lombardy  and  Spain,  from  Brittany 
and  the  Low  Countries,  as  well  as  armorers,  haberdashers  for 
man  and  beast,  usurers,  mimes  and  story-tellers,  acrobats,  nec- 
romancers, and  other  gentlemen  of  the  lists,  the  field,  the  road. 
Entertainers  of  every  stripe  found  liberal  patronage  .  .  .  There 
were  feasts  in  upper  chambers,  and  forges  rang  in  the  smithies 
all  night  long.  Brawls  with  grisly  incidents — a  cracked  skull,  a 
gouged  eye — occurred  as  the  betting  progressed  and  the  dice 
flew.  To  cry  up  their  champions  in  the  field  came  ladies  of  fair 
name  and  others  of  no  name  at  all. 

The  hazards,  the  concourse,  the  prizes,  keyed  men  to  the 
pitch  of  war.  The  stakes  were  magnificent,  for  the  victor  held 



his  prize,  horse  and  man,  for  ransom.  And  for  these  ransoms 
fiefs  went  in  gage  or  the  hapless  victim  fell  into  the  hands  of 
usurers,  giving  his  men,  and  in  extremity,  himself,  as  hostages. 
Fortunes  were  made  and  lost  on  the  point  of  a  lance  and  many 
a  mother's  son  failed  to  ride  home.139 

So,  it  was  not  only  that  the  merchants  supplied  the  materials  that 
made  the  fairs  possible;  Since  vanquished  knights  technically  owed 
their  lives  to  the  victors,  merchants  ended  up,  in  their  capacity  as 
moneylenders,  making  good  business  out  of  liquidating  their  assets. 
Alternately,  a  knight  might  borrow  vast  sums  to  outfit  himself  in  mag- 
nificence, hoping  to  impress  some  fair  lady  (with  handsome  dowry) 
with  his  victories;  others,  to  take  part  in  the  continual  whoring  and 
gambling  that  always  surrounded  such  events.  Losers  would  end  up 
having  to  sell  their  armor  and  horses,  and  this  created  the  danger  that 
they  would  go  back  to  being  highwaymen,  foment  pogroms  (if  their 
creditors  were  Jews)  or,  if  they  had  lands,  make  new  fiscal  demands  on 
those  unfortunate  enough  to  live  on  them. 

Others  turned  to  war,  which  itself  tended  to  drive  the  creation  of 
new  markets.140  In  one  of  the  most  dramatic  of  such  incidents,  in  No- 
vember 1199,  a  large  number  of  knights  at  a  tournament  at  the  castle  of 
Eery  in  Champagne,  sponsored  by  Henry's  son,  Theobald,  were  seized 
by  a  great  religious  passion,  abandoned  their  games,  and  swore  a  vow 
to  instead  retake  the  Holy  Land.  The  crusader  army  then  proceeded  to 
commission  the  Venetian  fleet  for  transport  in  exchange  for  a  promise 
of  a  50-percent  share  in  all  resulting  profits.  In  the  end,  rather  than 
proceeding  to  the  Holy  Land,  they  ended  up  sacking  the  (much  wealth- 
ier, Orthodox)  Christian  city  of  Constantinople  after  a  prolonged  and 
bloody  siege.  A  Flemish  count  named  Baldwin  was  installed  as  "Latin 
Emperor  of  Constantinople,"  but  attempting  to  govern  a  city  that  had 
been  largely  destroyed  and  stripped  of  everything  of  value  ensured  that 
he  and  his  barons  soon  ended  up  in  great  financial  difficulties.  In  a 
gigantic  version  of  what  was  happening  on  the  small  scale  in  so  many 
tournaments,  they  were  ultimately  reduced  to  stripping  the  metal  off 
the  church  roofs  and  auctioning  holy  relics  to  pay  back  their  Venetian 
creditors.  By  1259,  Baldwin  had  sunk  to  the  point  of  taking  out  a  mort- 
gage on  his  own  son,  who  was  taken  back  to  Venice  as  security  for 
a  loan.141 

All  this  does  not  really  answer  the  question:  Whence,  then,  this 
image  of  the  solitary  knight-errant,  wandering  the  forests  of  a  mythic 
Albion,  challenging  rivals,  confronting  ogres,  fairies,  wizards,  and  mys- 
terious beasts?  The  answer  should  be  clear  by  now.  Really,  this  is  just  a 



sublimated,  romanticized  image  of  the  traveling  merchants  themselves: 
men  who  did,  after  all,  set  off  on  lonely  ventures  through  wilds  and 
forests,  whose  outcome  was  anything  but  certain.142 

And  what  of  the  Grail,  that  mysterious  object  that  all  the  knights- 
errant  were  ultimately  seeking?  Oddly  enough,  Richard  Wagner,  com- 
poser of  the  opera  Parzifal,  first  suggested  that  the  Grail  was  a  sym- 
bol inspired  by  the  new  forms  of  finance.143  Where  earlier  epic  heroes 
sought  after,  and  fought  over,  piles  of  real,  concrete  gold  and  silver — 
the  Nibelung's  hoard — these  new  ones,  born  of  the  new  commercial 
economy,  pursued  purely  abstract  forms  of  value.  No  one,  after  all, 
knew  precisely  what  the  Grail  was.  Even  the  epics  disagree:  sometimes 
it's  a  plate,  sometimes  a  cup,  sometimes  a  stone.  (Wolfram  von  Eschen- 
bach  imagined  it  to  be  a  jewel  knocked  from  Lucifer's  helmet  in  a  bat- 
tle at  the  dawn  of  time.)  In  a  way  it  doesn't  matter.  The  point  is  that 
it's  invisible,  intangible,  but  at  the  same  time  of  infinite,  inexhaustible 
value,  containing  everything,  capable  of  making  the  wasteland  flower, 
feeding  the  world,  providing  spiritual  sustenance,  and  healing  wounded 
bodies.  Marc  Shell  even  suggested  that  it  would  best  be  conceived  as  a 
blank  check,  the  ultimate  financial  abstraction.144 

What,  Then,  Were  the  Middle  Ages? 

Each  of  us  is  a  mere  symbolon  of  a 
man,  the  result  of  bisection,  like  the 
flat  fish,  two  out  of  one,  and  each  of 
us  is  constantly  searching  for  his  corre- 
sponding symbolon. 

— Plato,  The  Symposium 

There  is  one  way  that  Wagner  got  it  wrong:  the  introduction  of  finan- 
cial abstraction  was  not  a  sign  that  Europe  was  leaving  the  Middle 
Ages,  but  that  it  was  finally,  belatedly,  entering  it. 

Wagner's  not  really  to  blame  here.  Almost  everyone  gets  this 
wrong,  because  the  most  characteristic  Medieval  institutions  and  ideas 
arrived  so  late  in  Europe  that  we  tend  to  mistake  them  for  the  first 
stirrings  of  modernity.  We've  already  seen  this  with  bills  of  exchange, 
already  in  use  in  the  East  by  700  or  800  ad,  but  only  reaching  Europe 
several  centuries  later.  The  independent  university — perhaps  the  quint- 
essential Medieval  institution — is  another  case  in  point.  Nalanda  was 
founded  in  42.7  ad,  and  there  were  independent  institutions  of  higher 



learning  all  over  China  and  the  Near  West  (from  Cairo  to  Constanti- 
nople) centuries  before  the  creation  of  similar  institutions  in  Oxford, 
Paris,  and  Bologna. 

If  the  Axial  Age  was  the  age  of  materialism,  the  Middle  Ages  were 
above  all  else  the  age  of  transcendence.  The  collapse  of  the  ancient  em- 
pires did  not,  for  the  most  part,  lead  to  the  rise  of  new  ones.145  Instead, 
once-subversive  popular  religious  movements  were  catapulted  into  the 
status  of  dominant  institutions.  Slavery  declined  or  disappeared,  as  did 
the  overall  level  of  violence.  As  trade  picked  up,  so  did  the  pace  of 
technological  innovation;  greater  peace  brought  greater  possibilities  not 
only  for  the  movement  of  silks  and  spices,  but  also  of  people  and  ideas. 
The  fact  that  monks  in  Medieval  China  could  devote  themselves  to 
translating  ancient  treatises  in  Sanskrit,  and  that  students  in  madrasas 
in  Medieval  Indonesia  could  debate  legal  terms  in  Arabic,  is  testimony 
to  the  profound  cosmopolitanism  of  the  age. 

Our  image  of  the  Middle  Ages  as  an  "age  of  faith" — and  hence,  of 
blind  obedience  to  authority — is  a  legacy  of  the  French  Enlightenment. 
Again,  it  makes  sense  only  if  you  think  of  the  "Middle  Ages"  as  some- 
thing that  happened  primarily  in  Europe.  Not  only  was  the  Far  West  an 
unusually  violent  place  by  world  standards,  the  Catholic  Church  was 
extraordinarily  intolerant.  It's  hard  to  find  many  Medieval  Chinese, 
Indian,  or  Islamic  parallels,  for  example,  to  the  burning  of  "witches"  or 
the  massacre  of  heretics.  More  typical  was  the  pattern  that  prevailed  in 
certain  periods  of  Chinese  history,  when  it  was  perfectly  acceptable  for 
a  scholar  to  dabble  in  Taoism  in  his  youth,  become  a  Confucian  in  mid- 
dle age,  then  become  a  Buddhist  on  retirement.  If  there  is  an  essence  to 
Medieval  thought,  it  lies  not  in  blind  obedience  to  authority,  but  rather 
in  a  dogged  insistence  that  the  values  that  govern  our  ordinary  daily 
affairs — particularly  those  of  the  court  and  marketplace — are  confused, 
mistaken,  illusory,  or  perverse.  True  value  lay  elsewhere,  in  a  domain 
that  cannot  be  directly  perceived,  but  only  approached  through  study 
or  contemplation.  But  this  in  turn  made  the  faculties  of  contemplation, 
and  the  entire  question  of  knowledge,  an  endless  problem.  Consider 
for  example  the  great  conundrum,  pondered  by  Muslim,  Christian,  and 
Jewish  philosophers  alike:  What  does  it  mean  to  simultaneously  say 
that  we  can  only  know  God  through  our  faculties  of  Reason,  but  that 
Reason  itself  partakes  of  God?  Chinese  philosophers  were  struggling 
with  similar  conundrums  when  they  asked,  "Do  we  read  the  classics  or 
do  the  classics  read  us?"  Almost  all  the  great  intellectual  debates  of  the 
age  turned  on  this  question  in  one  way  or  another.  Is  the  world  created 
by  our  minds,  or  our  minds  by  the  world? 



We  can  see  the  same  tensions  within  predominant  theories  of  mon- 
ey. Aristotle  had  argued  that  gold  and  silver  had  no  intrinsic  value  in 
themselves,  and  that  money  therefore  was  just  a  social  convention, 
invented  by  human  communities  to  facilitate  exchange.  Since  it  had 
"come  about  by  agreement,  therefore  it  is  within  our  power  to  change 
it  or  render  it  useless"  if  we  all  decide  that  that's  what  we  want  to 
do.146  This  position  gained  little  traction  in  the  materialist  intellectual 
environment  of  the  Axial  Age,  but  by  the  later  Middle  Ages,  it  had 
become  standard  wisdom.  Ghazali  was  among  the  first  to  embrace  it. 
In  his  own  way  he  took  it  even  further,  insisting  that  the  fact  that  a 
gold  coin  has  no  intrinsic  value  is  the  basis  of  its  value  as  money,  since 
this  very  lack  of  intrinsic  value  is  what  allows  it  to  "govern,"  measure, 
and  regulate  the  value  of  other  things.  But  at  the  same  time,  Ghazali 
denied  that  money  was  a  social  convention.  It  was  given  us  by  God.147 

Ghazali  was  a  mystic,  and  a  political  conservative,  so  one  might 
argue  that  he  ultimately  shied  away  from  the  most  radical  implications 
of  his  own  ideas.  But  one  could  also  ask  whether,  in  the  Middle  Ages, 
arguing  that  money  was  an  arbitrary  social  convention  was  really  all 
that  radical  a  position.  After  all,  when  Christian  and  Chinese  think- 
ers insisted  that  it  was,  it  was  almost  always  as  a  way  of  saying  that 
money  is  whatever  the  king  or  the  emperor  wished  it  to  be.  In  that 
sense,  Ghazali's  position  was  perfectly  consonant  with  the  Islamic  de- 
sire to  protect  the  market  from  political  interference  by  saying  that  it 
fell  properly  under  the  aegis  of  religious  authorities. 

I  I  I  I  I 

The  fact  that  Medieval  money  took  such  abstract,  virtual  forms — 
checks,  tallies,  paper  money — meant  that  questions  like  these  ("What 
does  it  mean  to  say  that  money  is  a  symbol?")  cut  to  the  core  of  the 
philosophical  issues  of  the  day.  Nowhere  is  this  so  true  as  in  the  his- 
tory of  the  word  "symbol"  itself.  Here  we  encounter  some  parallels  so 
extraordinary  that  they  can  only  be  described  as  startling. 

When  Aristotle  argued  that  coins  are  merely  social  conventions, 
the  term  he  used  was  symbolon — from  which  our  own  word  "symbol" 
is  derived.  Symbolon  was  originally  the  Greek  word  for  "tally" — an 
object  broken  in  half  to  mark  a  contract  or  agreement,  or  marked  and 
broken  to  record  a  debt.  So  our  word  "symbol"  traces  back  originally 
to  objects  broken  to  record  debt  contracts  of  one  sort  or  another. 
This  is  striking  enough.  What's  really,  remarkable,  though,  is  that  the 
contemporary  Chinese  word  for  "symbol,"  fu,  or  fu  bao,  has  almost 
exactly  the  same  origin.148 



Let's  start  with  the  Greek  term  "symbolon."  Two  friends  at  dinner 
might  create  a  symbolon  if  they  took  some  object — a  ring,  a  knuckle- 
bone, a  piece  of  crockery — and  broke  it  in  half.  Any  time  in  the  future 
when  either  of  them  had  need  of  the  other's  help,  they  could  bring 
their  halves  as  reminders  of  the  friendship.  Archeologists  have  found 
hundreds  of  little  broken  friendship  tablets  of  this  sort  in  Athens,  often 
made  of  clay.  Later  they  became  ways  of  sealing  a  contract,  the  ob- 
ject standing  in  the  place  of  witnesses.149  The  word  was  also  used  for 
tokens  of  every  sort:  those  given  to  Athenian  jurors  entitling  them  to 
vote,  or  tickets  for  admission  to  the  theater.  It  could  be  used  refer  to 
money  too,  but  only  if  that  money  had  no  intrinsic  value:  bronze  coins 
whose  value  was  fixed  only  by  local  convention. 150  Used  for  written 
documents,  a  symbolon  could  also  be  passport,  contract,  commission, 
or  receipt.  By  extension,  it  came  to  mean:  omen,  portent,  symptom,  or 
finally,  in  the  now-familiar  sense,  symbol. 

The  path  to  the  latter  appears  to  have  been  twofold.  Aristotle  fixed 
on  the  fact  that  a  tally  could  be  anything:  what  the  object  was  didn't 
matter;  all  that  mattered  was  that  there  was  a  way  to  break  it  in  half. 
It  is  exactly  so  with  language:  words  are  sounds  we  use  to  refer  to  ob- 
jects, or  to  ideas,  but  the  relation  is  arbitrary:  there's  no  particular  rea- 
son, for  example,  that  English-speakers  should  choose  "dog"  to  refer 
to  an  animal  and  "god"  to  refer  to  a  deity,  rather  than  the  other  way 
around.  The  only  reason  is  social  convention:  an  agreement  between  all 
speakers  of  a  language  that  this  sound  shall  refer  to  that  thing.  In  this 
sense,  all  words  were  arbitrary  tokens  of  agreement.151  So,  of  course,  is 
money — for  Aristotle,  not  only  worthless  bronze  coins  that  we  agree  to 
treat  as  if  they  were  worth  a  certain  amount,  but  all  money,  even  gold, 
is  just  a  symbolon,  a  social  convention."2 

All  this  came  to  seem  almost  commonsensical  in  the  thirteenth 
century  of  Thomas  Aquinas,  when  rulers  could  change  the  value  of 
currency  simply  by  issuing  a  decree.  Still,  Medieval  theories  of  symbols 
derived  less  from  Aristotle  than  from  the  Mystery  Religions  of  Antiq- 
uity, where  "symbolon"  came  to  refer  to  certain  cryptic  formulae  or 
talismans  that  only  initiates  could  understand.153  It  thus  came  to  mean 
a  concrete  token,  perceptible  to  the  senses,  that  could  only  be  under- 
stood in  reference  to  some  hidden  reality  entirely  beyond  the  domain 
of  sensory  experience.154 

The  theorist  of  the  symbol  whose  work  was  most  widely  read 
and  respected  in  the  Middle  Ages  was  a  sixth-century  Greek  Christian 
mystic  whose  real  name  has  been  lost  to  history,  but  who  is  known 
by  his  pseudonym  Dionysius  the  Areopagite.155  Dionysius  took  up  the 
notion  in  this  latter  sense  to  confront  what  was  to  become  the  great 



intellectual  problem  of  the  age:  How  is  it  possible  for  humans  to  have 
knowledge  of  God?  How  can  we,  whose  knowledge  is  confined  to  what 
our  senses  can  perceive  of  the  material  universe,  have  knowledge  of  a 
being  whose  nature  is  absolutely  alien  to  that  material  universe — "that 
infinity  beyond  being,"  as  he  puts  it,  "that  oneness  that  is  beyond  intel- 
ligence"?'56 It  would  be  impossible  were  it  not  for  the  fact  that  God, 
being  all-powerful,  can  do  anything,  and  therefore,  just  as  he  places 
his  own  body  in  the  Eucharist,  so  can  he  reveal  himself  to  our  minds 
through  an  endless  variety  of  material  shapes.  Intriguingly,  Dionysius 
warns  us  that  we  cannot  begin  to  understand  how  symbols  work  until 
we  rid  ourselves  of  the  notion  that  divine  things  are  likely  to  be  beauti- 
ful. Images  of  luminous  angels  and  celestial  chariots  are  only  likely  to 
confuse  us,  since  we  will  be  tempted  to  imagine  that  that's  what  heaven 
is  actually  like,  and  in  fact  we  cannot  possibly  conceive  of  what  heaven 
is  like.  Instead,  effective  symbols  are,  like  the  original  symbolon,  home- 
ly objects  selected  apparently  at  random;  often,  ugly,  ridiculous  things, 
whose  very  incongruity  reminds  us  that  they  are  not  God;  of  the  fact 
that  God  "transcends  all  materiality,"  even  as,  in  another  sense,  they 
are  God.'57  But  the  notion  that  they  are  in  any  sense  tokens  of  agree- 
ment between  equals  is  gone  entirely.  Symbols  are  gifts,  absolute,  free, 
hierarchical  gifts,  presented  by  a  being  so  far  above  us  that  any  thought 
of  reciprocity,  debt,  or  mutual  obligation  is  simply  inconceivable.158 

Compare  the  Greek  dictionary  above  to  the  following,  from  a  Chi- 
nese dictionary: 

FU.  To  agree  with,  to  tally.  The  two  halves  of  a  tally. 

•  evidence;  proof  of  identity,  credentials 

•  to  fulfill  a  promise,  to  keep  one's  word 

•  to  reconcile 

•  the  mutual  agreement  between  Heaven's  appointment 
and  human  affairs 

•  a  tally,  a  check 

•  an  imperial  seal  or  stamp 

•  a  warrant,  a  commission,  credentials 

•  like  fitting  the  two  halves  of  a  tally,  in  exact  agreement 

•  a  symbol,  a  sign  .  .  .'" 

The  evolution  is  almost  exactly  the  same.  Like  symbola,  fu  can  be 
tallies,  contracts,  official  seals,  warrants,  passports,  or  credentials.  As 
promises,  they  can  embody  an  agreement,  a  debt  contract,  or  even  a 
relation  of  feudal  vassalage — since  a  minor  lord  agreeing  to  become 



another  man's  vassal  would  split  a  tally  just  as  he  would  if  borrowing 
grain  or  money.  The  common  feature  seems  to  be  a  contract  between 
two  parties  that  begin  as  equal,  in  which  one  agrees  to  become  subordi- 
nate. Later,  as  the  state  became  more  centralized,  we  mainly  hear  about 
fu  presented  to  officials  as  a  means  of  conveying  order:  the  official 
would  take  the  left  half  with  him  when  posted  to  the  provinces,  and 
when  the  emperor  wished  to  send  an  important  command,  he  would 
send  the  right  half  with  the  messenger  to  make  sure  that  the  official 
knew  it  was  actually  the  imperial  will.160 

We've  already  seen  how  paper  money  seems  to  have  developed 
from  paper  versions  of  such  debt  contracts,  ripped  in  half  and  reunited. 
For  Chinese  theorists,  of  course,  Aristotle's  argument  that  money  was 
simply  a  social  convention  was  hardly  radical;  it  was  simply  assumed. 
Money  was  whatever  the  emperor  established  it  to  be.  Though  even 
here  there  was  a  slight  proviso,  as  evidenced  in  the  entry  above,  that 
"fu"  could  also  refer  to  "the  mutual  agreement  between  heaven's  ap- 
pointment and  human  affairs."  Just  as  officials  were  appointed  by  the 
emperor,  the  emperor  was  ultimately  appointed  by  a  higher  power,  and 
he  could  only  rule  effectively  as  long  as  he  kept  its  mandate,  which  is 
why  propitious  omens  were  called  "fu,"  signs  that  heaven  approved  of 
the  ruler,  just  as  natural  disasters  were  a  sign  that  he  had  strayed.161 

Here  Chinese  ideas  did  grow  a  bit  closer  to  the  Christian  ones.  But 
Chinese  conceptions  of  the  cosmos  had  one  crucial  difference:  since  there 
was  no  emphasis  on  the  absolute  gulf  between  our  world  and  the  one  be- 
yond it,  contractual  relations  with  the  gods  were  by  no  means  out  of  the 
question.  This  was  particularly  true  in  Medieval  Taoism,  where  monks 
were  ordained  through  a  ceremony  called  "rending  the  tally,"  ripping 
apart  a  piece  of  paper  that  represented  a  contract  with  heaven.162  It  was 
the  same  with  the  magical  talismans,  also  called  "fu,"  which  an  adept 
might  receive  from  his  master.  These  were  literally  tallies:  the  adept  kept 
one;  the  other  half  was  said  to  be  retained  by  the  gods.  Such  talismanic 
fu  took  the  form  of  diagrams,  said  to  represent  a  form  of  celestial  writ- 
ing, comprehensible  only  to  the  gods,  which  committed  them  to  assist  the 
bearer,  often  giving  the  adept  the  right  to  call  on  armies  of  divine  protec- 
tors with  whose  help  he  could  slay  demons,  cure  the  sick,  or  otherwise 
attain  miraculous  powers.  But  they  could  also  become,  like  Dionysius' 
symbola,  objects  of  contemplation,  by  which  one's  mind  can  ultimately 
attain  some  knowledge  of  the  invisible  world  beyond  our  own.163 

Many  of  the  most  compelling  visual  symbols  to  emerge  from  Me- 
dieval China  trace  back  to  such  talismans:  the  River  Symbol,  or,  for 
that  matter,  the  yin-yang  symbol  that  seems  to  have  developed  out  of 
it.164  Just  looking  at  a  yin-yang  symbol,  it  is  easy  enough  to  imagine 



the  left  and  right  (sometimes,  too,  called  "male"  and  "female")  halves 
of  a  tally. 

A  tally  does  away  with  the  need  for  witnesses;  if  the  two  surfaces  agree, 
then  everyone  knows  that  the  agreement  between  the  contracting  par- 
ties exists  as  well.  This  is  why  Aristotle  saw  it  as  a  fit  metaphor  for 
words:  word  A  corresponds  to  concept  B  because  there  is  a  tacit  agree- 
ment that  we  shall  act  as  if  it  does.  The  striking  thing  about  tallies  is 
that  even  though  they  might  begin  as  simple  tokens  of  friendship  and 
solidarity,  in  almost  all  the  later  examples,  what  the  two  parties  actu- 
ally agree  to  create  is  a  relation  of  inequality:  of  debt,  obligation,  sub- 
ordination to  another's  orders.  This  is  in  turn  what  makes  it  possible 
to  use  the  metaphor  for  the  relation  between  the  material  world  and 
that  more  powerful  world  that  ultimately  gives  it  meaning.  The  two 
sides  are  the  same.  Yet  what  they  create  is  absolute  difference.  Hence 
for  a  Medieval  Christian  mystic,  as  for  Medieval  Chinese  magicians, 
symbols  could  be  literal  fragments  of  heaven — even  if  for  the  first,  they 
provided  a  language  whereby  one  could  have  some  understanding  of 
beings  one  could  not  possibly  interact  with;  while  for  the  second,  they 
provided  a  way  of  interacting,  even  making  practical  arrangements, 
with  beings  whose  language  one  could  not  possibly  understand. 

On  one  level,  this  is  just  another  version  of  the  dilemmas  that 
always  arise  when  we  try  to  reimagine  the  world  through  debt — that 
peculiar  agreement  between  two  equals  that  they  shall  no  longer  be 
equals,  until  such  time  as  they  become  equals  once  again.  Still,  the 
problem  took  on  a  peculiar  piquancy  in  the  Middle  Ages,  when  the 
economy  became,  as  it  were,  spiritualized.  As  gold  and  silver  migrated 
to  holy  places,  ordinary  transactions  everywhere  came  to  be  carried  out 
primarily  through  credit.  Inevitably,  arguments  about  wealth  and  mar- 
kets became  arguments  about  debt  and  morality,  and  arguments  about 
debt  and  morality  became  arguments  about  the  nature  of  our  place  in 
the  universe.  As  we've  seen,  the  solutions  varied  considerably.  Europe 
and  India  saw  a  return  to  hierarchy:  society  became  a  ranked  order 
of  Priests,  Warriors,  Merchants,  and  Farmers  (or  in  Christendom,  just 
Priests,  Warriors,  and  Farmers).  Debts  between  the  orders  were  con- 
sidered threatening  because  they  implied  the  potential  of  equality,  and 
they  often  led  to  outright  violence.  In  China,  in  contrast,  the  principle 
of  debt  often  became  the  governing  principle  of  the  cosmos:  karmic 
debts,  milk-debts,  debt  contracts  between  human  beings  and  celestial 
powers.  From  the  point  of  view  of  the  authorities,  all  these  led  to 



excess,  and  potentially  to  vast  concentrations  of  capital  that  might 
throw  the  entire  social  order  out  of  balance.  It  was  the  responsibility  of 
government  to  intervene  constantly  to  keep  markets  running  smoothly 
and  equitably,  thus  avoiding  new  outbreaks  of  popular  unrest.  In  the 
world  of  Islam,  where  theologians  held  that  God  recreated  the  en- 
tire universe  at  every  instant,  market  fluctuations  were  instead  seen  as 
merely  another  manifestation  of  divine  will. 

The  striking  thing  is  that  the  Confucian  condemnation  of  the  mer- 
chant, and  the  Islamic  celebration  of  the  merchant,  ultimately  led  to  the 
same  thing:  prosperous  societies  with  flourishing  markets,  but  where 
the  elements  never  came  together  to  create  the  great  merchant  banks 
and  industrial  firms  that  were  to  become  the  hallmark  of  modern  capi- 
talism. It's  especially  striking  in  the  case  of  Islam.  Certainly,  the  Islamic 
world  produced  figures  who  would  be  hard  to  describe  as  anything 
but  capitalists.  Large-scale  merchants  were  referred  to  as  sahib  al-mal, 
"owners  of  capital,"  and  legal  theorists  spoke  freely  about  the  creation 
and  expansion  of  capital  funds.  At  the  height  of  the  Caliphate,  some 
of  these  merchants  were  in  possession  of  millions  of  dinars  and  seeking 
profitable  investment.  Why  did  nothing  like  modern  capitalism  emerge? 
I  would  highlight  two  factors.  First,  Islamic  merchants  appear  to  have 
taken  their  free-market  ideology  seriously.  The  marketplace  did  not 
fall  under  the  direct  supervision  of  the  government;  contracts  were 
made  between  individuals — ideally,  "with  a  handshake  and  a  glance  at 
heaven" — and  thus  honor  and  credit  became  largely  indistinguishable. 
This  is  inevitable:  you  can't  have  cutthroat  competition  where  there 
is  no  one  stopping  people  from  literally  cutting  one  another's  throats. 
Second,  Islam  also  took  seriously  the  principle,  later  enshrined  in  clas- 
sical economic  theory  but  only  unevenly  observed  in  practice,  that 
profits  are  the  reward  for  risk.  Trading  enterprises  were  assumed  to 
be,  quite  literally,  adventures,  in  which  traders  exposed  themselves  to 
the  dangers  of  storm  and  shipwreck,  savage  nomads,  forests,  steppes, 
and  deserts,  exotic  and  unpredictable  foreign  customs,  and  arbitrary 
governments.  Financial  mechanisms  designed  to  avoid  these  risks  were 
considered  impious.  This  was  one  of  the  objections  to  usury:  if  one 
demands  a  fixed  rate  of  interest,  the  profits  are  guaranteed.  Similarly, 
commercial  investors  were  expected  to  share  the  risk.  This  made  most 
of  the  forms  of  finance  and  insurance  that  were  to  later  develop  in 
Europe  impossible.165 

In  this  sense  the  Buddhist  monasteries  of  early  Medieval  China 
represent  the  opposite  extreme.  The  Inexhaustible  Treasuries  were  in- 
exhaustible because,  by  continually  lending  their  money  out  at  inter- 
est and  never  otherwise  touching  their  capital,  they  could  guarantee 



effectively  risk-free  investments.  That  was  the  entire  point.  By  doing  so, 
Buddhism,  unlike  Islam,  produced  something  very  much  like  what  we 
now  call  "corporations" — entities  that,  through  a  charming  legal  fic- 
tion, we  imagine  to  be  persons,  just  like  human  beings,  but  immortal, 
never  having  to  go  through  all  the  human  untidiness  of  marriage,  re- 
production, infirmity,  and  death.  To  put  it  in  properly  Medieval  terms, 
they  are  very  much  like  angels. 

Legally,  our  notion  of  the  corporation  is  very  much  a  product  of 
the  European  High  Middle  Ages.  The  legal  idea  of  a  corporation  as  a 
"fictive  person"  {persona  ficta) — a  person  who,  as  Maitland,  the  great 
British  legal  historian,  put  it,  "is  immortal,  who  sues  and  is  sued,  who 
holds  lands,  has  a  seal  of  his  own,  who  makes  regulations  for  those 
natural  persons  of  whom  he  is  composed"166 — was  first  established  in 
canon  law  by  Pope  Innocent  IV  in  1250  ad,  and  one  of  the  first  kinds  of 
entities  it  applied  to  were  monasteries — as  also  to  universities,  church- 
es, municipalities,  and  guilds.167 

The  idea  of  the  corporation  as  an  angelic  being  is  not  mine,  inci- 
dentally. I  borrowed  it  from  the  great  Medievalist  Ernst  Kantorowicz, 
who  pointed  out  that  all  this  was  happening  right  around  the  same 
time  that  Thomas  Aquinas  was  developing  the  notion  that  angels  were 
really  just  the  personification  of  Platonic  Ideas.168  "According  to  the 
teachings  of  Aquinas,"  he  notes,  "every  angel  represented  a  species." 

Little  wonder  then  that  finally  the  personified  collectives  of 
the  jurists,  which  were  juristically  immortal  species,  displayed 
all  the  features  otherwise  attributed  to  angels  .  .  .  The  jurists 
themselves  recognized  that  there  was  some  similarity  between 
their  abstractions  and  the  angelic  beings.  In  this  respect,  it  may 
be  said  that  the  political  and  legal  world  of  thought  of  the  later 
Middle  Ages  began  to  be  populated  by  immaterial  angelic  bod- 
ies, large  and  small:  they  were  invisible,  ageless,  sempiternal, 
immortal,  and  sometimes  even  ubiquitous;  and  they  were  en- 
dowed with  a  corpus  intellectuale  or  mysticum  [an  intellectual 
or  mystical  body]  which  could  stand  any  comparison  with  the 
"spiritual  bodies"  of  the  celestial  beings.169 

All  this  is  worth  emphasizing  because  while  we  are  used  to  assum- 
ing that  there's  something  natural  or  inevitable  about  the  existence  of 
corporations,  in  historical  terms,  they  are  actually  strange,  exotic  crea- 
tures. No  other  great  tradition  came  up  with  anything  like  it.170  They 
are  the  most  peculiarly  European  addition  to  that  endless  proliferation 



of  metaphysical  entities  so  characteristic  of  the  Middle  Ages — as  well 
as  the  most  enduring. 

They  have,  of  course,  changed  a  great  deal  over  time.  Medieval  cor- 
porations owned  property,  and  they  often  engaged  in  complex  financial 
arrangements,  but  in  no  case  were  they  profit-seeking  enterprises  in  the 
modern  sense.  The  ones  that  came  closest  were,  perhaps  unsurpris- 
ingly, monastic  orders — above  all,  the  Cistercians — whose  monaster- 
ies became  something  like  the  Chinese  Buddhist  ones,  surrounded  by 
mills  and  smithies,  practicing  rationalized  commercial  agriculture  with 
a  workforce  of  "lay  brothers"  who  were  effectively  wage  laborers, 
spinning  and  exporting  wool.  Some  even  talk  about  "monastic  capi- 
talism."171 Still,  the  ground  was  only  really  prepared  for  capitalism  in 
the  familiar  sense  of  the  term  when  the  merchants  began  to  organize 
themselves  into  eternal  bodies  as  a  way  to  win  monopolies,  legal  or  de 
facto,  and  avoid  the  ordinary  risks  of  trade.  An  excellent  case  in  point 
was  the  Society  of  Merchant  Adventurers,  charted  by  King  Henry  IV 
in  London  in  1407,  who,  despite  the  romantic-sounding  name,  were 
mainly  in  the  business  of  buying  up  British  woolens  and  selling  them 
in  the  Flanders  fairs.  They  were  not  a  modern  joint-stock  company, 
but  a  rather  old-fashioned  Medieval  merchant  guild,  but  they  provided 
a  structure  whereby  older,  more  substantial  merchants  could  simply 
provide  loans  to  younger  ones,  and  they  managed  to  secure  enough  of 
an  exclusive  control  over  the  woolen  trade  that  substantial  profits  were 
pretty  much  guaranteed.172  When  such  companies  began  to  engage  in 
armed  ventures  overseas,  though,  a  new  era  of  human  history  might  be 
said  to  have  begun. 

Chapter  Eleven 



"Eleven  pesos,  then;  and  as  you  can't 
pay  me  the  eleven  pesos,  that  makes  an- 
other eleven  pesos — twenty-two  in  all: 
eleven  for  the  serape  and  the  petate  and 
eleven  because  you  can't  pay.  Is  that 
right,  CrisieroV 

Crisiero  had  no  knowledge  of  fig- 
ures, so  it  was  very  natural  that  he 
said,  "That  is  right,  patron." 

Don  Arnulfo  was  a  decent,  honor- 
able man.  Other  landowners  were  a  good 
deal  less  softhearted  with  their  peons. 

"The  shirt  is  five  pesos.  Right? 
Very  well.  And  as  you  can't  pay  for  it, 
that's  five  pesos.  And  as  you  remain  in 
my  debt  for  the  five  pesos,  that's  five 
pesos.  And  as  1  shall  never  have  the 
money  from  you,  that's  five  pesos.  So 
that  makes  five  and  five  and  five  and 
five.  That's  twenty  pesos.  Agreed}" 

"Yes,  patron,  agreed." 

The  peon  can  get  the  shirt  no- 
where else  when  he  needs  one.  He 
can  get  credit  nowhere  but  from  his 
master,  for  whom  he  works  and  from 
whom  he  can  never  get  away  as  long 
as  he  owes  him  a  centavo. 

— B.  Traven,  The  Carreta 



THE  EPOCH  THAT  BEGAN  with  what  we're  used  to  calling  the  "Age 
of  Exploration"  was  marked  by  so  many  things  that  were  genuinely 
new — the  rise  of  modern  science,  capitalism,  humanism,  the  nation- 
state — that  it  may  seem  odd  to  frame  it  as  just  another  turn  of  an 
historical  cycle.  Still,  from  the  perspective  I've  been  developing  in  this 
book,  that  is  what  it  was. 

The  era  begins  around  1450  with  a  turn  away  from  virtual  curren- 
cies and  credit  economies  and  back  to  gold  and  silver.  The  subsequent 
flow  of  bullion  from  the  Americas  sped  the  process  immensely,  spark- 
ing a  "price  revolution"  in  Western  Europe  that  turned  traditional 
society  upside-down.  What's  more,  the  return  to  bullion  was  accompa- 
nied by  the  return  of  a  whole  host  of  other  conditions  that,  during  the 
Middle  Ages,  had  been  largely  suppressed  or  kept  at  bay:  vast  empires 
and  professional  armies,  massive  predatory  warfare,  untrammeled  usu- 
ry and  debt  peonage,  but  also  materialist  philosophies,  a  new  burst  of 
scientific  and  philosophical  creativity — even  the  return  of  chattel  slav- 
ery. It  was  in  no  way  a  simple  repeat  performance.  All  the  Axial  Age 
pieces  reappeared,  but  they  came  together  in  an  entirely  different  way. 

The  1400s  are  a  peculiar  period  in  European  history.  It  was  a  century 
of  endless  catastrophe:  large  cities  were  regularly  decimated  by  the 
Black  Death;  the  commercial  economy  sagged  and  in  some  regions  col- 
lapsed entirely;  whole  cities  went  bankrupt,  defaulting  on  their  bonds; 
the  knightly  classes  squabbled  over  the  remnants,  leaving  much  of 
the  countryside  devastated  by  endemic  warfare.  Even  in  geopolitical 
terms  Christendom  was  staggering,  with  the  Ottoman  Empire  not  only 
scooping  up  what  remained  of  Byzantium  but  pushing  steadily  into 
central  Europe,  its  forces  expanding  on  land  and  sea. 

At  the  same  time,  from  the  perspective  of  many  ordinary  farmers 
and  urban  laborers,  times  couldn't  have  been  much  better.  One  of  the 
perverse  effects  of  the  bubonic  plague,  which  killed  off  about  one-third 
of  the  European  workforce,  was  that  wages  increased  dramatically.  It 
didn't  happen  immediately,  but  this  was  largely  because  the  first  reac- 
tion of  the  authorities  was  to  enact  legislation  freezing  wages,  or  even 
attempting  to  tie  free  peasants  back  to  the  land  again.  Such  efforts  were 
met  with  powerful  resistance,  culminating  in  a  series  of  popular  upris- 
ings across  Europe.  These  were  squelched,  but  the  authorities  were  also 
forced  to  compromise.  Before  long,  so  much  wealth  was  flowing  into 
the  hands  of  ordinary  people  that  governments  had  to  start  introducing 



new  laws  forbidding  the  lowborn  to  wear  silks  and  ermine,  and  to  limit 
the  number  of  feast  days,  which,  in  many  towns  and  parishes,  began 
eating  up  one-third  or  even  half  of  the  year.  The  fifteenth  century  is,  in 
fact,  considered  the  heyday  of  Medieval  festive  life,  with  its  floats  and 
dragons,  maypoles  and  church  ales,  its  Abbots  of  Unreason  and  Lords 
of  Misrule.' 

Over  the  next  centuries,  all  this  was  to  be  destroyed.  In  England, 
the  festive  life  was  systematically  attacked  by  Puritan  reformers;  then 
eventually  by  reformers  everywhere,  Catholic  and  Protestant  alike.  At 
the  same  time  its  economic  basis  in  popular  prosperity  dissolved. 

Why  this  happened  has  been  a  matter  of  intense  historical  debate 
for  centuries.  This  much  we  know:  it  began  with  a  massive  inflation. 
Between  1500  and  1650,  for  instance,  prices  in  England  increased  500 
percent,  but  wages  rose  much  more  slowly,  so  that  in  five  generations, 
real  wages  fell  to  perhaps  40  percent  of  what  they  had  been.  The  same 
thing  happened  everywhere  in  Europe. 

Why?  The  favorite  explanation,  ever  since  a  French  lawyer  named 
Jean  Bodin  first  proposed  it  in  1568,  was  the  vast  influx  of  gold  and 
silver  that  came  pouring  into  Europe  after  the  conquest  of  the  New 
World.  As  the  value  of  precious  metals  collapsed,  the  argument  went, 
the  price  of  everything  else  skyrocketed,  and  wages  simply  couldn't 
keep  up.2  There  is  some  evidence  to  support  this.  The  height  of  popular 
prosperity  around  1450  did  correspond  to  a  period  when  bullion — and 
therefore,  coin — was  in  particularly  short  supply.3  The  lack  of  cash 
played  havoc  with  international  trade  in  particular;  in  the  1460s,  we 
hear  of  ships  full  of  wares  forced  to  turn  back  from  major  ports,  as  no 
one  had  any  cash  on  hand  to  buy  from  them.  The  problem  only  started 
to  turn  around  later  in  the  decade,  with  a  sudden  burst  of  silver  mining 
in  Saxony  and  the  Tirol,  followed  by  the  opening  of  new  sea  routes  to 
the  Gold  Coast  of  West  Africa.  Then  came  the  conquests  of  Cortes  and 
Pizarro.  Between  1520  and  1640,  untold  tons  of  gold  and  silver  from 
Mexico  and  Peru  were  transported  across  the  Atlantic  and  Pacific  in 
Spanish  treasure  ships. 

The  problem  with  the  conventional  story  is  that  very  little  of  that 
gold  and  silver  lingered  very  long  in  Europe.  Most  of  the  gold  ended 
up  in  temples  in  India,  and  the  overwhelming  majority  of  the  silver 
bullion  was  ultimately  shipped  off  to  China.  The  latter  is  crucial.  If  we 
really  want  to  understand  the  origins  of  the  modern  world  economy, 
the  place  to  start  is  not  in  Europe  at  all.  The  real  story  is  of  how  China 
abandoned  the  use  of  paper  money.  It's  a  story  worth  telling  briefly, 
because  very  few  people  know  it. 



After  the  Mongols  conquered  China  in  1271,  they  kept  the  system  of 
paper  money  in  place,  and  even  made  occasional  (if  usually  disastrous) 
attempts  to  introduce  it  in  the  other  parts  of  their  empire.  In  1368, 
however,  they  were  overthrown  by  another  of  China's  great  popular 
insurrections,  and  a  former  peasant  leader  was  once  again  installed 
in  power. 

During  their  century  of  rule,  the  Mongols  had  worked  closely  with 
foreign  merchants,  who  became  widely  detested.  Partly  as  a  result,  the 
former  rebels,  now  the  Ming  dynasty,  were  suspicious  of  commerce  in 
any  form,  and  they  promoted  a  romantic  vision  of  self-sufficient  agrar- 
ian communities.  This  had  some  unfortunate  consequences.  For  one 
thing,  it  meant  the  maintenance  of  the  old  Mongol  tax  system,  paid  in 
labor  and  in  kind;  especially  since  that,  in  turn,  was  based  on  a  quasi- 
caste  system  in  which  subjects  were  registered  as  farmers,  craftsmen, 
or  soldiers  and  forbidden  to  change  their  jobs.  This  proved  extraordi- 
narily unpopular.  While  government  investment  in  agriculture,  roads, 
and  canals  did  set  off  a  commercial  boom,  much  of  this  commerce  was 
technically  illegal,  and  taxes  on  crops  were  so  high  that  many  indebted 
farmers  began  to  flee  their  ancestral  lands.4 

Typically,  such  floating  populations  can  be  expected  to  seek  just 
about  anything  but  regular  industrial  employment;  here  as  in  Europe, 
most  preferred  a  combination  of  odd  jobs,  peddling,  entertainment, 
piracy,  or  banditry.  In  China,  many  also  turned  prospector.  There 
was  a  minor  silver  rush,  with  illegal  mines  cropping  up  everywhere. 
Uncoined  silver  ingots,  instead  of  official  paper  money  and  strings  of 
bronze  coins,  soon  became  the  real  money  of  the  off-the-books  infor- 
mal economy.  When  the  government  attempted  to  shut  down  illegal 
mines  in  the  1430s  and  1440s,  their  efforts  sparked  local  insurrections, 
in  which  miners  would  make  common  cause  with  displaced  peasants, 
seize  nearby  cities,  and  sometimes  threaten  entire  provinces.5 

In  the  end,  the  government  gave  up  even  trying  to  suppress  the 
informal  economy.  Instead,  they  swung  the  other  way  entirely:  stopped 
issuing  paper  money,  legalized  the  mines,  allowed  silver  bullio